Unity is terminating its agreement with Peter Jackson's former VFX studio, laying off 265 employees in the process

Several na'vi, tall, blue, feline aliens from Avatar: The Way of Water are seated in a camp.
(Image credit: Avatar: The Way of Water Trailer (20th Century Studios))

It's been a 'fun' and 'interesting' year for Unity. A retroactive runtime fee that drew the anger of basically every developer leading to a change in leadership, an AI program it's only recently done due diligence on, and some big, sweeping layoffs. 

Back in May, Unity laid off 600 employees and closed half its offices. Earlier this month, it said further layoffs were 'likely'. According to a Reuters report, those layoffs have begun. Unity has scrapped a large part of its agreement with Weta Digital, which it acquired for $1.6 billion back in 2021. 265 employees—just ten shy of the 275 engineers Unity acquired back then—will lose their jobs.

This follows both a trend of layoffs in the tech industry at-large, like Meta, Microsoft, and Google, as well as in the gaming industry specifically. Ubisoft, 505 Games, and even Humble Bundle have made cuts to employee numbers in November alone. For Unity, this brings its combined layoffs this year to 825

Weta FX itself offers plenty of tools via Unity, though its focus seems mainly on 3D animation in film. Fortunately, Weta FX issued a statement to fxguide, saying it'll try to rehire its former talent. "Weta FX will be extending offers to as many of the team as possible as it looks to expand its research, development and support functions." 

In regards to what Weta FX will keep, "Unity will retain ownership of the technology it acquired from Weta in December 2021 and will be evaluating the best way to enhance its offerings with it over time. The technology will also remain fully available to Weta FX. Weta FX will continue to build and extend the IP, and develop its own tools and techniques, to continue its evolution as a leader in visual effects."

It's a curious move considering it's not like Weta FX has been circling the drain or anything—having recently won both an Academy Award and a BAFTA for Avatar: The Way of Water. Still, it depends entirely on what Unity wants to focus on. 

There's a sort-of silver lining in this round of layoffs, though: Unity's renewed approach to remote working. It will no longer mandate a three days a week office schedule, for example. However, considering the scope of CEO James M. Whitehurst's statements earlier this month, promising "a comprehensive assessment of our product portfolio", I'd be very surprised if the shuttling of Weta FX wasn't just an appetiser of what's to come.

Staff Writer

Harvey's history with games started when he first begged his parents for a World of Warcraft subscription aged 12, though he's since been cursed with Final Fantasy 14-brain and a huge crush on G'raha Tia. He made his start as a freelancer, writing for websites like Techradar, The Escapist, Dicebreaker, The Gamer, Into the Spine—and of course, PC Gamer. He'll sink his teeth into anything that looks interesting, though he has a soft spot for RPGs, soulslikes, roguelikes, deckbuilders, MMOs, and weird indie titles. He also plays a shelf load of TTRPGs in his offline time. Don't ask him what his favourite system is, he has too many.