Meta Just Shut Down Some of Its Major VR Studios

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Meta, formerly known as Facebook, has announced it’s closing three of its own virtual reality (VR) game development studios. This follows recent layoffs at the company. Among the studios closing is Sanzaru Games, which created popular and highly-rated VR games like Asgard’s Wrath and its planned sequel, both exclusive to Meta Quest.

Sanzaru Games was founded in 2006 by veterans from Activision. They first gained recognition in 2008 with Ninja Reflex, a party game for the Nintendo Wii and DS, though it received somewhat mixed reactions. The following year, they developed a version of Secret Agent Clank for the PlayStation 2, which was a spin-off of the popular Ratchet & Clank series on the PSP. Throughout the early 2010s, Sanzaru worked closely with Sony, creating The Sly Collection and Sly Cooper: Thieves in Time, as well as bringing the God of War Collection to the PS Vita.

In 2019, Sanzaru Games and Oculus Studios created the critically praised action-RPG, Asgard’s Wrath. Shortly after, in February 2020, Facebook (now Meta) acquired Sanzaru Games, bringing them under the Oculus Studios umbrella. The team then released Asgard’s Wrath 2 in 2023 as an exclusive title for the Meta Quest 3. Currently, it boasts a 91% average score from top critics on OpenCritic, making it one of the highest-rated VR games available, alongside Half-Life: Alyx.

Meta Shuts Down Three First-Party VR Studios

On January 12, 2026, the New York Times reported that Meta intended to cut 10-15% of its staff within the Reality Labs division, which includes Oculus Studios. The following day, Meta confirmed these layoffs, closing three studios: Sanzaru Games, Armature, and Twisted Pixel. The news was first shared on X (formerly Twitter) by @andyTHPS, a former developer at Vicarious Visions who had been working at Twisted Pixel, stating that the entire Twisted Pixel games studio, as well as Sanzaru Games, had been shut down.

Gematsu reported that Meta had closed several game development studios, including Twisted Pixel, Sanzaru, and Armature. Meta confirmed the closures with an official statement to Gematsu, which read:

Last month, we announced we were moving some of our funding away from the Metaverse and towards Wearables. This action supports that plan, and we’ll use the money saved to help our Wearables business grow this year.

Sanzaru Games has created two of the most popular VR games for Meta Quest, but other studios like Armature and Twisted Pixel have consistently delivered quality titles as well. Armature, founded in 2008, is known for games like Batman: Arkham Origins Blackgate and the Xbox One exclusive ReCore. They also ported Metal Gear Solid HD Collection and Injustice to the PS Vita. Most recently, they developed the highly praised Resident Evil 4 for Meta Quest 2, which has received an 86% average score from top critics on OpenCritic. Notably, Armature didn’t release any games while owned by Meta.

Twisted Pixel has been a fixture in the video game industry since its founding in 2006. The studio is particularly remembered for its popular Xbox Live Arcade games, . While not a standout title on the Meta Quest platform, received generally positive reviews, achieving a 78% average score from top critics on OpenCritic. However, despite these achievements, Twisted Pixel, along with Armature and Sanzaru Games, has been officially shut down and is not expected to reopen.

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2026-01-14 18:06