Avalanche Studios has confirmed it is closing its Liverpool office, a decision that follows the recent suspension of work on the Xbox-published title Contraband.

The news comes just weeks after Avalanche announced that “active development” on the cooperative smuggling game had stopped while the studio and its partners reassessed the project’s future. First unveiled in 2021, Contraband was pitched as an open-world adventure set in a fictional 1970s setting known as Bayan. Hype around the game was significant at the time of its reveal, but little concrete information had surfaced since.

With the Liverpool office now scheduled to shut its doors, employees there have entered a formal consultation period, as required under UK employment law. Avalanche said the closure was part of a broader restructuring effort aimed at addressing “current challenges to our business and the wider industry.”

The Swedish developer is also reducing headcounts across its Malmö and Stockholm locations. While the company has not provided exact figures on layoffs, the impact is expected to be felt across multiple departments.

The fate of Contraband remains uncertain. Although Avalanche has not explicitly cancelled the game, halting development alongside the closure of a key studio suggests the project is unlikely to return in its original form. Xbox had positioned the game as a potential co-op showcase for its platform, making its indefinite pause a notable setback for both parties.

Avalanche Studios, best known for the Just Cause series and its work on Mad Max, has weathered ups and downs before. The company grew rapidly during the last console generation, opening new offices and expanding into multiple projects. But with the broader games industry facing a wave of cuts, consolidations, and cancelled titles, Avalanche’s decision fits into a difficult pattern many studios have been forced to follow this year.

For the developers affected, the closure of the Liverpool office marks the end of a chapter that never had the chance to fully take shape. For fans, it’s another reminder that even big-budget games can vanish quietly, leaving only a teaser trailer and what-ifs in their wake.