High Voltage, the studio responsible for Wii-exclusive shooter The Conduit, has been hit by cut-backs, with 25 of the studio's staff losing their jobs.
Consumer site IGN has reported that no more staff are expected to leave following the cuts.
An unnamed studio employee confirmed the losses, stating that High Voltage had "reduced some of its staffing based on our current production requirements and predictions of what is needed for the remainder of 2010."
"We are sad to have to say goodbye to these employees and friends, but these changes are necessary to bring our organisation to a healthy operational size."
High Voltage is currently working on a sequel to The Conduit, as well as multi-platform horror shooter The Grinder. The company has produced over 60 games on multiple platforms since its inception in 1993.