The video game industry is a tough market. Competition is fierce and comes from every corner of the world, aside from that, its very complex and requires high knowledge, experience, and huge investments, with some games requiring budgets higher than Hollywood blockbusters.
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Game studios come and go. Everything has its lifespan, including them. Some studios go in style, some of them fight to the end, while others accept their fate. Directly or indirectly, more or less all of them are caused by financial problems. There is a long list of studios that ended tragically and faced the worst scenario.
10Guerrilla Cambridge
Guerrilla Cambridge is, as its name says, an English studio based in Cambridge and was founded by Sony Computer Entertainment. The company is best known for its MediEvil series but also produced some interesting games likePrimalfor PlayStation 2 andLittleBigPlanetfor PlayStation Portable.
The company was first named SCE Cambridge Studio but later renamed so it could become a sister studio to a Guerrilla Games. Several employees were let go by the company in 2014 and later Guerrilla Cambridge was close down in a restructuring process on 20 July 2025.
9Bizzare Creations
Like the previous studio, Bizzare Creations is also based in England, this time in Liverpool. Before changing its name, the company was called Raising Hell Software. The studio developed games in different genres with more or less successful titles being:Formula 1,Fur Fighters,Metropolis Street Racer,Treasure Planet, andBlur, with their last game beingJames Bond 007: Blood Stone.
In 2007Activisionacquired Bizzare Creations for 107.4 million dollars. Later in 2010 Activision stated that is exploring the options for the future of the studio, including its potential sale. It couldn’t find the buyer and closed the studio.
8Neversoft
Neversoft was founded in 1994 by three employees of Malibu Interactive. Throughout its history the company had its ups and downs - it started well by developing games for Sega Saturn and PlayStation.
After that, the company experienced financial troubles, but fortunately signed contracts with Activision to produce a third-person shooter calledApocalypseand starring Bruce Willis, and later theTony Hawks Pro Skaterseries which increased studios size to 150 people. In 2014 Neversoft merged with Infinity Ward and was made defunct 20 years after its forming.
7Silicon Knights
Canadian game studio, Silicon Knights was founded in 1992 by Denis Dyack and was headquartered in Ontario. The studio developed several games during its run likeBlood Omen: Legacy of Kain,Metal Gear Solid: Twin Snakes,Too Human,and their last game beingX-Men: Destiny.
The company declared bankruptcy after it lost the court case against Epic Games for copyright infringement of Unreal Engine 3, and was ordered to pay 4.45 million dollars in damages, a sum that was later doubled when including attorneys fees and cost. Additionally, the studio was ordered to destroy all unsold retail games developed on Unreal Engine 3.
6Ensemble Studios
The company was formed in 1994 by Tony Goodman. In 2001 it was acquired by Microsoft where it operated as an internal studio till its end. Ensemble Studio was specialized in creating real-time strategy games and its portfolio includes theAge of Empiresseries,Star Wars Battlegrounds,Age of Mythology, andHalo Wars.
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It also developed its own engine - Genie Game Engine. The company shut down in 2009 after the internal statement issued byMicrosoftwhich was later leaked to the public. During its run, the company managed to sell 20 million games worth 500 million dollars.
5Zipper Interactive
The company was based in Redmond in Washington and was formed in 1995 by Jim Bosler and Brian Soderberg. It was best known for itsSOCOMseries and its last game wasUnit 13for PlayStation Vita.
Zipper Interactive suffered the same fate as the first studio on the list Guerrilla Cambridge. Both studios were owned bySonyComputer Entertainment, and Zipper Interactive like Guerrilla Cambridge wasshut downin the restructuring process, or more precisely resource re-alignment. At the time of its closing, the studio had two projects for the PlayStation 4 in its development.
The company was founded in 1997 by Peter Molyneux and several other co-founders, and the company was named after the pet hamster one of the co-founders owned. Lionhead Studios is best known for theBlack & WhiteandFableseries.
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In 2006 after financial difficulties the studio was acquired by Microsoft. The studioclosedas a result of the cancellation of its gameFable Legends, but before that, it suffered serious problems when some of its senior staff departed, including thecompany founder. The studio encountered difficulties during the project and Microsoft closed the studio in 2016.
3Visceral Games
Visceral Games was founded in 1998 by Electronic Arts as its subsidiary. The studio’s first game wasFuture Cop: LAPDand later achieved critical, and moderate financial success with theDead Spaceseries which had three installments.
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It also developed many other games including the Tiger Woods golf series, severalJames Bondgames, theSimsseries,Army of Two: The Devils Cartel, twoGodfathergames, andDantes Inferno. Electronic Artsclosedthe studio on June 19, 2025, aftercancelingits last project named Ragtag which was supposed to be anotherStar Warsgame.
2Pandemic Studios
A game developer previously based in Los Angels in California was founded in 1998 by two former Activision employees. Pandemic Studios developed a large variety of not very well known games likeDark Reign 2,Mercenaries: Playground of Destruction,Star Wars: Battlefront,andDestroy All Humans!.
The studio had an unhappy ending when it was acquired byElectronic Artsin 2007 andshut downtwo years later. Its last game wasThe Saboteur. Prior to that, Electronic Arts cut 1,500 jobs through various studios, including Pandemic, who lost 228 employees.
1THQ
Founded in April 1990 by Jack Friedman,THQwas a household name with many games well known and successful games likeCompany of Heroes,Darksiders,Destroy All Humans!,Homefront, andSaints Row. The company initially started in the toy business; that’s why its called THQ, which is an acronym forToyHeadquarters.
THQ enjoyed financial success in the 2000s, but experienced a decline in sales in 2009. The company suffered a loss of 136.1 million dollars in 2011 and 239.9 million dollars in 2012, and, as a result on June 09, 2025, THQdeclared bankruptcyending its two decades in the gaming industry.
