Paradox Interactive continues to cut costs. The Swedish publisher has decided to shut down one of its studios after canceling an upcoming game.
On June 17, Paradox announced the cancelation of Life by You, which was expected to launch in Early Access on June 4 after several delays. Despite seeing the potential in this project, the company eventually decided that it won’t be able to meet its expectations.
“Moving forward, we should perform at a much higher level, and it’s obvious that we have work ahead of us,” CEO Fredrik Wester said in a statement, adding that Paradox performed poorly in recent releases and that “we have to evaluate how we manage projects and how we organize, for we will and must get better.”
As a result, the company will write down the total capitalized development costs for Life by You of SEK 208 million ($19.8 million). This will negatively impact its second fiscal quarter ending June 30, 2024.
Shortly after the news, Paradox announced its decision to close Paradox Tectonic, a California-based studio behind Life by You. “Sadly, with cancellation of their sole project we have to take the tough decision to close down the studio. We are deeply grateful for their hard work in trying to take Paradox into a new genre,” Wester said.
Established in 2019, Paradox Tectonic employed 24 people. The team was led by Rod Humble, an industry veteran who previously worked on life sim titles such as Second Life, The Sims 2, and The Sims 3.
Paradox Interactive still relies heavily on its evergreen hits, including Crusader Kings III, Stellaris, and Hearts of Iron IV. However, it has been struggling with new releases for a while, with Cities: Skylines II and Millennia each receiving mixed reviews from players at launch,
In the company’s Q1 report, Wester noted that “we have areas where we need to do better, not least, our games must maintain a good and consistent quality.”
Last year, Paradox closed two support studios behind DLCs for Crusader Kings III and Stellaris. It also parted ways with Harebrained Schemes after a commercial flop of its turn-based tactics The Lamplighters League.
Following several failures, the Swedish company said it wants to focus on its core niches (mainly strategy games) and franchises to ensure its long-term growth. Life by You was Paradox’s attempt to step into a new genre, but this experiment turned out to be unsuccessful.