German developer Daedalic Entertainment is shutting down their internal game development team(s), following their troubled release of The Lord of the Rings: Gollum.

While Daedalic is shutting down their internal game development, the company will instead focus entirely on being a publisher for other games moving forward.

Of the company’s 90+ employees, Daedalic confirmed 25 staff will be laid off though they will assist in helping them find new positions elsewhere.

“We value each and every member of our team and it is important to us that the transition goes as smoothly as possible,” Daedalic said to German site GamesWirtschaft. “Therefore, we will support our former employees in finding new opportunities within our network.”

As part of the restructuring, another Lord of the Rings game the company has had in the works since 2022 has been cancelled. Their next release, Surviving Deponia, is being made by an external developer AtomicTorch Studio, and is not affected by the layoffs.

The Lord of the Rings: Gollum is was released in May 2023 across Windows PC (via Steam), Xbox One, Xbox Series X|S, Switch, PlayStation 4, and PlayStation 5. Check out our thorough written+video review!