11 Bit Studios lays off unknown number of staff, cancels Project 8 console game

Frostpunk developer 11 Bit Studios has cancelled the development of its first console-centric title, codenamed Project 8, resulting in an unknown number of layoffs.

Development of Project 8 began in 2018, with 37 people working on it by the end of September 2024. The studio estimates that it had spent PLN 48.4 million ($11.8 million) on development up to this point.

However, a post on the studio's website revealed a recent review of the project led to 11 Bit's management board to terminate the project. Studio president Przemysław Marszał said that more than half of the Project 8 team will be offered opportunities on other projects within the company.

Those who are affected by the layoffs will receive severance packages, assistance in finding new employment, and psychological counselling.

The studio is currently exploring how the assets developed for Project 8 may be used or adapted for other projects.

"Our vision for Project 8, which was intended to be our first title designed specifically for console gamers, was bold and exciting," said Marszał. "However, it was conceived under very different market conditions, when narrative-driven, story-rich games held stronger appeal."

He added that the game's development experienced various setbacks, especially during the COVID-19 pandemic, which led to several delays and the project's budget grew with each milestone. The studio's evaluation of the most recent milestone was the tipping point for Project 8.

"Unfortunately, in this case, our findings revealed unresolved issues and challenges that would require further extensions of the production timeline and corresponding budget increases to address," Marszał explained.

"This, coupled with revised sales forecasts, largely reflecting the changing market environment, raised significant doubts about the project’s overall profitability."

As a result, the 11 Bit management board lost confidence in the prospect of Project 8 being finished on time and to a reasonable quality level, leading to the game's termination.

Project 8 was one of seven projects 11 Bit committed to in 2020, investing more than $21 million across them.

In October, the studio announced it has delayed another of its upcoming games, The Alters.