Heart Machine Lays Off Nearly Everyone After Publisher Pulls Funding

This is Heart Machine’s third major round of layoffs in under two years. That is the number that puts Wednesday’s news in context — not a studio going through a rough patch, but one that has been shedding staff since November 2024 and may not survive what just happened next.

On 16 September 2026, Heart Machine founder Alx Preston posted on LinkedIn with a blunt opening line: “I have very difficult news today.” The studio behind Hyper Light Drifter had been working on an unannounced title funded by a publisher. That publisher, unnamed, chose to walk away this week. Without the income, the studio was forced to lay off nearly its entire remaining team. Preston described it as devastating — and did not rule out Heart Machine closing for good.

Why the Studio’s Future Is Now in Question

Preston’s LinkedIn post was unusually candid for a studio announcement. He confirmed that the publisher-funded project was Heart Machine’s primary source of income, and that without it, there were no immediate prospects or alternative funds to keep the team employed. “Nearly everyone at the studio had to be laid off,” he wrote. “It’s devastating.”

Those affected are being given support, including help finding new roles. Preston asked the industry directly: if you know of positions for “extraordinarily talented, kind people,” reach out. But his outlook for the studio itself was measured at best. “Right now, I’m not sure yet how or if Heart Machine survives,” he wrote. “We’ll keep pushing to build a path.”

“Navigating an increasingly challenging industry has been extremely difficult. However, we’ll keep pushing to build a path.” — Alx Preston, Heart Machine founder

The publisher who withdrew funding has not been identified, and neither has the project. Heart Machine has not published any further comment beyond Preston’s post.

A Studio That Has Been Bleeding For Two Years

To understand the weight of this moment, the timeline matters. Heart Machine first laid off a significant number of staff in November 2024, at the same time it was finishing Hyper Light Breaker. That game launched in early access in January 2025 — and struggled. By October 2025, the studio cancelled its ongoing development entirely, parting with more workers in the process.

The game that briefly looked like Heart Machine’s next chapter — Possessor(s) — did eventually ship, giving the studio a finished release. But the losses had compounded. In March 2026, some of the studio’s remaining employees unionised, citing the industry’s volatility and the strain of repeated layoffs. That decision came from the people still left after two rounds of cuts.

The unannounced publisher-funded project was meant to be the path forward. Now that path has closed.

What Might Come Next for Heart Machine

The indie studio has genuine goodwill in the industry. Hyper Light Drifter, its 2016 debut, became a touchstone for pixel-art action RPGs and earned the kind of cult following that persists for years. That legacy is real — but legacy does not pay wages.

Possible routes remain. Fan funding via Patreon is not new territory for Heart Machine; the studio launched a Patreon in late 2024 as it navigated earlier financial pressure. A new publishing deal with a different partner is the most straightforward recovery scenario, though the same industry dynamics that caused one publisher to withdraw are still in play. Preston has not ruled out either option.

Heart Machine’s situation is unfortunately not isolated. Double Fine laid off around a quarter of its staff in late July 2026, and the broader games industry has spent the past two years churning through layoffs at a rate not seen since the mid-2000s consolidation wave. For smaller studios depending on a single external funding source, the risk is existential the moment that source disappears.

For now, the studio’s door is still technically open. Whether it stays that way depends on what Preston and whoever remains can pull together in the coming weeks.