Embracer-owned studios can't catch a break, and Eidos-Montréal has been hit over and over again by layoffs and project cancellations for several years now. This week, roughly 124 employees were let go, with studio head David Anfossi also leaving. It's now unclear how the developer's future looks like, but we might have learned what happened behind the scenes.

Insider Gaming's Tom Henderson shared on 31st March a pretty substantial look into what caused the latest round of layoffs. The main reason seemingly was the cancellation of a big open-world game tentatively titled Wildlands, which "had been in development since early 2019" and taken resources away from other projects, such as the cancelled Deus Ex game that was reportedly binned in January 2024. As a reminder, a planned Legacy of Kain reboot had to be axed too after Embracer acquired the studio.

Though Eidos-Montréal has been helping out with the development of Xbox-controlled titles like Grounded 2 and Fable, the studio was also working on the unannounced "AAAA" game that was put down recently. The pictured painted by IG's report isn't a pretty one: "According to sources, the game had been struggling for years, with 4 different game engines used throughout development, narrative direction conflicts, and a budget that had exploded to several hundred million."

The site has apparently seen in-game footage of the game as well (thanks to anonymous sources). Apparently, it was an open-world third-person action-adventure game starring a character named River, who "was part of a group of teenagers called Spiritbounds, who could ward off bad spirits with their magical staffs and ride mythical creatures." A giant "mouse-looking" animal companion could be used to move around the map. The most shocking reveal was that "the game was almost complete" and maybe even aiming to release later this year.

"Embracer probably went cold on the project and felt like any future investment wouldn’t be recouped," Henderson theorised. If true, it's yet another frustrating turn of events for a once mighty studio that hasn't shipped a game of its own since 2021's (in my opinion) underrated Guardians of the Galaxy.

So what's next for Eidos-Montréal? Well, another IG report from December 2025 suggested it's recently taken on a long-in-the-works Alien action-adventure game, which does sound a great deal safer than a gigantic new IP and, from Embracer's perspective, might justify the cancellation of Wildlands and yet another reallocation of resources.