Xbox shuts down The Initiative and Perfect Dark

After years of silence, internal turmoil, and no released games, both the studio and its flagship project are officially dead.

So long, farewell. Microsoft is shutting down its Santa Monica-based AAA studio The Initiative, founded in 2018. Seven years, not a single game released. And their ambitious reboot of Perfect Dark, developed in collaboration with Crystal Dynamics, has now been completely scrapped.

Perfect Dark was meant to revive the Rare classic with modern visuals and a more story-driven approach, starring Joanna Dark in a fight against mega-corporations in a climate-ravaged future. But development was slow from the start, plagued by internal issues, high staff turnover, and unclear creative direction. Problems that likely pushed Microsoft to finally pull the plug.

The closure is part of a massive wave of layoffs across the Microsoft organisation, affecting roughly 9,000 employees — around 4% of the company's workforce. Other projects like Rare's Everwild and an unannounced MMORPG from ZeniMax Online Studios have also been cancelled.

Microsoft Gaming boss Matt Booty admitted in an internal memo that these moves are a reallocation of resources to focus on safer, more strategically important investments — though he added they were "not taken lightly." Cold comfort for those affected.

Were you looking forward to Perfect Dark?