Meta has initiated a significant reduction in its internal virtual reality development footprint, confirming the closure of three established studios: Twisted Pixel, Sanzaru Games, and Armature Studio. These shutdowns are directly tied to a massive layoff initiative impacting the Reality Labs division, which is responsible for the company’s VR hardware and software portfolio.
Reports indicate that Meta is cutting over 1,000 jobs within Reality Labs, affecting roughly 10% of the division’s workforce. The closures reflect a major strategic pivot, as Meta shifts its focus and investment capital away from core metaverse development and toward emerging areas like AI wearables and new phone features. A spokesperson confirmed the resource reallocation, noting that the savings would be reinvested to support the growth of these new initiatives.
This decision means the end for several respected teams that Meta acquired over the past five years. Sanzaru Games, which joined in 2020, was recently celebrated for developing the critically acclaimed Quest title, *Asgard’s Wrath 2*. Armature Studio, known for porting *Resident Evil 4* to VR, and Twisted Pixel, developers of *Marvel’s Deadpool VR* and earlier Xbox 360 hits like *‘Splosion Man*, are now shuttered.
While the loss of these internal developers, following the closure of Ready At Dawn last year, casts doubt on Meta’s long-term commitment to proprietary game content, the company states it remains committed to gaming. Moving forward, Meta plans to focus investment on third-party developers and partners, signaling a shift toward a publishing model to ensure the “long-term sustainability” of its VR gaming ecosystem.