In a bold move that has raised eyebrows across the gaming industry, Undead Labs studio head Philip Holt has come forward to discuss the layoffs that have shaken his team. In an interview with The Game Business, Holt revealed that he intentionally kept employees informed about the impending job losses as part of the Xbox divestiture and transition to independent ownership.
This candor was a deliberate choice on Holt’s part, aimed at reducing anxiety among staff who were facing uncertainty over their futures. By being open and transparent from the outset, Holt hoped to provide his team with the time and space to explore new opportunities before the layoffs took place. “Rather than keeping them in the dark and manufacturing some alternate reality,” he explained, “I just brought them alongside.” This approach was a refreshing departure from the usual practice of springing unexpected news on employees.
The WARN Act, California’s worker adjustment and retraining notification law, requires companies with over 75 employees to provide at least 60 days’ notice before conducting mass layoffs. Although Undead Labs is based in Washington, Holt’s decision to inform staff early seems to reflect the spirit of this legislation. By giving employees advance warning, he allowed them to prepare for the worst and potentially secure new roles.
The specifics of the layoffs are still unclear, with Holt refusing to confirm a specific number of job losses. However, it’s been confirmed that the cuts were “significant.” Despite this setback, Undead Labs remains committed to its ongoing projects, including State of Decay 3, a zombie survival game first announced under the Xbox banner in 2020.
Holt’s decision to prioritize transparency in the face of adversity sends a powerful message about the importance of open communication within the gaming industry. In an era where studio closures and layoffs are increasingly common, Holt’s approach offers a beacon of hope for employees facing uncertainty about their futures. As we move forward, it will be interesting to see how other studios respond to similar challenges, and whether they follow Undead Labs’ lead in prioritizing transparency and employee well-being.
Ultimately, this situation serves as a poignant reminder that the gaming industry is not immune to the economic pressures faced by many other sectors. However, it also highlights the resilience of its employees and their capacity for adaptability in the face of change. As we look towards the future of VR/XR, one thing is clear: studios like Undead Labs will continue to play a vital role in shaping the landscape of immersive gaming, even as they navigate the challenges that come with it.
Source: Game Developer XR — 2026-10-06