Sony to close Dark Outlaw Games amid continued restructuring of PlayStation studios

Sony is reportedly preparing to shut down Dark Outlaw Games, a first-party studio led by former Call of Duty producer Jason Blundell, according to a report by Bloomberg journalist Jason Schreier. The closure marks another significant shift in the company’s ongoing reassessment of its gaming strategy, particularly within its PlayStation division.

More layoffs today: PlayStation is closing Dark Outlaw Games, a studio formed last year by former Call of Duty lead Jason Blundell (his previous PlayStation studio, Deviation, was shut down in 2024). PlayStation is also making other cuts including in mobile development. Around 50 people laid off.

— Jason Schreier (@jasonschreier.bsky.social) March 25, 2026 at 2:10 AM

Dark Outlaw Games had not publicly revealed any projects since its formation, leaving uncertainty about the scope and direction of its work. However, given Blundell’s extensive background in multiplayer titles, industry observers widely expected the studio to be developing an online-focused game for PlayStation platforms.

Background of the studio and its leadership

Jason Blundell is a well-known figure in the gaming industry, having built his reputation through his work on the Call of Duty franchise. He began his career as a programmer and producer at Activision before moving to Treyarch, where he contributed to several major titles, including Call of Duty 3.

Blundell later played a key role in shaping the Black Ops series. He served as director for the campaign and Zombies mode of Call of Duty: Black Ops III and oversaw the career and Zombies modes in Call of Duty: Black Ops 4. His experience in developing large-scale multiplayer experiences made him a notable hire for Sony as it sought to expand its presence in the live-service gaming space.

Before leading Dark Outlaw Games, Blundell headed Deviation Games, an independent studio that had partnered with Sony on a PlayStation project. That studio was eventually shut down before its game was released, raising questions about the continuity of projects tied to its leadership. The transition from Deviation Games to Dark Outlaw Games had been seen as a fresh start, though details remained limited.

Sony has not yet issued an official statement regarding the closure of Dark Outlaw Games. Requests for comment have reportedly been made, but further clarification on the studio’s fate and any potential impact on its staff has not been confirmed.

Wider layoffs and shifting priorities

The reported closure comes alongside additional cuts affecting PlayStation’s mobile development teams. These reductions suggest a broader restructuring effort within Sony’s gaming division, as the company reconsiders its investments across market segments.

Over the past year, Sony has implemented a series of layoffs and studio closures, signalling a shift away from its earlier ambitions to expand its portfolio of live-service and multiplayer titles rapidly. This strategy had been a major focus for the company, but recent developments indicate a more cautious approach.

In February, Sony shut down Bluepoint Games following unsuccessful attempts to develop a live-service title based on the God of War franchise. Earlier setbacks also include the closure of Firewalk Studios after the underwhelming performance of the multiplayer shooter Concord, which launched in October 2024.

In December 2023, Naughty Dog confirmed that it had abandoned plans for a standalone multiplayer version of The Last of Us. The decision was widely interpreted as a recognition of the challenges of maintaining large-scale live-service projects while continuing to deliver high-quality single-player experiences.

These developments reflect a broader industry trend, as publishers reassess the sustainability of live-service models amid rising development costs and increased competition.

Future of Sony’s multiplayer ambitions

Despite recent setbacks, Sony has not entirely withdrawn from the multiplayer space. Several projects remain in development, suggesting that the company still views online gaming as an important part of its long-term strategy.

Among these are multiple spin-offs from the Horizon Zero Dawn universe, including a cooperative title being developed by Guerrilla Games and a massively multiplayer online project in collaboration with NCSoft. Fairgame$, a title from Haven Studios, is also continuing development despite leadership changes, including the departure of studio head Jade Raymond.

Other ongoing multiplayer efforts include Helldivers 2 from Arrowhead Game Studios, as well as continued support for Bungie’s Destiny 2 and its upcoming title Marathon. Even Gran Turismo 7 maintains an online component, contributing to Sony’s broader ecosystem of connected gaming experiences.

However, the mixed results of recent initiatives have raised questions about the effectiveness of Sony’s expansion into live-service gaming. While the company has achieved success in single-player titles, replicating that success in the competitive multiplayer market has proven more difficult.

The closure of Dark Outlaw Games highlights the challenges Sony faces as it recalibrates its strategy. Balancing investment in new multiplayer projects with the risks associated with long-term live-service development remains a complex task.