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Kluge Interactive, the developer behind popular VR rhythm game Synth Riders (2018), confirmed the studio has suffered a “major round of layoffs” earlier this year.

Kluge Interactive has been busy creating games for Horizon Worlds, Roblox, and bringing Synth Riders to new non-VR platforms, like Nintendo Switch.

Earlier this year though, Meta announced it was pulling the plug on first-party studios amid the announcement it was shifting priorities away from ongoing Quest support for Horizon Worlds, making it “almost exclusively” a mobile app.

As first reported by Brad Lynch (via UploadVR), Kluge Interactive quietly suffered a round of layoffs which Lynch says was “[p]rimarily due to Meta stopping VR support entirely for Horizon Worlds. Which Kluge was funded to build games in.”

Replying to Lynch, CEO of Kluge Interactive Arturo Perez confirmed layoffs, noting the studio has effectively been halved in size:

“I can confirm that we had major rounds of layoffs in December and January. Synth Riders remains steady but not enough to support our full studio. We are currently a team of 50 from a peak of 100 last year (we also had a major round last December).”

Notably, Perez didn’t confirm whether layoffs were indeed a direct result of Meta pulling funding, however Kluge Interactive was publicly partnered with Meta to build games for Horizon Worlds.

This follows wider turmoil in the XR industry, which has included a rash of project cancellations and layoffs. In January, Meta announced it was closing first-party VR studios Armature Studio (Resident Evil 4 VR), Twisted Pixel (Deadpool VR), and Sanzaru Games (Asgard’s Wrath).

Cancelled projects included an unannounced Batman: Arkham Shadow sequel from Sanzaru, an unannounced Harry Potter VR game for Quest from Skydance Games, and a major project from Moss developers Polyarc.

This has seemingly caused a knock-on effect, which has prompted the closure of Horizon Worlds competitor Rec Room. Once valued at $3.5 billion, Rec Room is set go offline in June.

Additionally, VR veteran developer nDreams also signaled last month that internal studios Near Light or Compass are currently at risk of closure. nDreams says the core of its business will center nDream Elevation, a mostly remote studio which released Reach (2025) late last year.