British studio Coatsink, the creator of Kingdom: Two Crowns and Islanders, has begun a restructuring process that is expected to result in the loss of 50-60 positions, or more than half the company. The news was announced by Thunderful's parent companywhich said Coatsink was leading the firm's co-development segment but had not delivered enough work.
“New contracts have been awarded, but due to the completion of major projects and a more challenging co-development market, the business is currently unable to support all existing staff,” Thandeful said in a press release, adding that a consultation process with affected staff had begun.
“With a more concentrated focus, the studio remains well positioned to deliver all existing and future top-tier projects, enhance partnership value and capitalize on its strong commercial portfolio to secure new opportunities.”
Coatsink is currently working on Men In Black: Most Wanted for Meta Quest headsets after previously releasing Augmented Empire and Jurassic World: Aftermath for the same platform. The latest release was the well-received sequel Islanders: New Shores for PC and Nintendo Switch.
Thunderful acquired Coatsink in 2020 for £23 million in cash and shares. Founders Tom Beardsmore, Eddie Beardsmore and Paul Crabb left the company in August, shortly after Atari acquired a majority stake in Thunderful.
Atari paid $5.3 million for 82% of the business, which underwent two rounds of restructuring and the closure and sale of several subsidiaries and game studios. Atari CEO Wade Rosen spoke with GamesIndustry.biz in September and cited Coatsink's strengths in joint development as a benefit of the acquisition: “Our core development teams working with both Digital Eclipse and Nightdive are growing very quickly and really need the support of other talented engineers,” he said.
Thunderful's latest financial report showed an overall loss of -SEK320.8 million for the year to September. Revenue from the joint development, which would have included Coatsink, was SEK 71.6 million in the period and adjusted EBITDA was SEK 10.4 million.
