Image via Nerial / Devolver Digital
U.S. publisher Devolver Digital has laid off 40 percent of employees at internal studio Nerial after identifying "issues" with recent releases.
The studio is best known for developing Reigns and more recently The Crush House. The former is one of Devolver's most successful franchises to date, having earned over $20 million in lifetime revenue across five titles.
Devolver acquired Nerial in 2021 alongside Firefly Studios and Dodge Roll. The studio's 'About Us' webpage currently lists 11 employees.
"Nerial has undergone a team restructure to address issues around recent releases and to better shape the team for future releases," reads Devolver‛s FY24 investor presentation. "This restructure has resulted in a 40 percent reduction in headcount."
Devolver confirmed it "refocused" a number of internal teams during the past fiscal year.
Polish study Artificer was downsized by over 50 percent in early 2024 (as reported at the time), while it also reduced the headcount of Good Shepherd and subsidiary Big Fan Games (which only launched in October 2024) by 50 percent over the course of the year.
The company's overall headcount was reduced from a peak of 303 at the end of 2023 to approximately 270 at the end of 2024. That downsizing includes the layoffs mentioned above.
Devolver said it will continue to "assess the appropriate size of its global footprint" while continuing to invest more heavily in "long-tail expandable games."
"The majority of overall investment is currently directed into first party IP, with a similar focus on existing franchises and IP," it added. "First party spend in 2025 includes Starseeker, System Era Softworks' next major project, and other unannounced titles. Spend [is] expected to reduce over the coming years—2025 recognized as our peak investment year."
Appraising its wider performance, Devolver described 2024 as "strong" after annual revenue increased by 13 percent year-on-year to $104.8 million. Gross profit also rose by 23 percent to $30.1 million.
