VR studio nDreams has proposed a restructuring plan that could result in the closure of two internal studios, Near Light and Compass—the latter of which was only established in February 2025. The move has also placed 78 employees at risk of redundancy.
The company today informed staff members that internal studio Elevation, which currently has around 120 people working on unannounced projects, will be placed at the core of its restructured business. The UK studio also intends to retain a “lean” R&D group focused on emerging XR technologies.
A company spokesperson confirmed the news in a statement to Game Developer and explained that nDreams’ executive team could also be impacted by the cuts.
“The company’s proposals include the closure of the Near Light and Compass studios, and a reduction in its Facilities, Talent, Shared Technology, and Executive teams, with 78 roles at risk of redundancy,” reads the statement.
“Despite every effort to make the existing structure a success, the VR games market remains challenging, making further changes necessary to ensure a commercially viable and sustainable future.”
The company, known for working on VR titles like Reach, Frenzies, Far Cry VR, and Powerwash Simulator VR, said it is committed to exploring every option to retain talent. CEO Tim Gillo said nDreams “fought hard” to avoid making layoffs, but noted the VR market continues to present “undeniable commercial challenges.”
“I still believe in the mission, and the medium. My hope is that today’s proposals will enable nDreams to continue its pioneering journey, developing innovative, VR-first, high-quality games and XR experiences for many years to come,” he added.
The company will now enter a collective consultation process with those impacted by the proposed cuts.
The news comes around a year after nDreams shuttered two internal studios before establishing Compass, which as stated earlier is now also facing closure. Months prior, nDreams made 17.5 percent of its workforce redundant.
The VR company is owned by Swedish conglomerate Aonic, which purchased nDreams for $110 million in 2023.