Crysis developer Crytek has confirmed its Budapest studio is to take a new direction, but has refused to comment on rumours of layoffs.
A source close to the business told GamesIndustry.biz that as many as 50 roles could go at the studio which has been working on Kinect exclusive title Codename Kingdoms for the past two years.
However, the source claims that game has now been moved to Crytek's Frankfurt studio following completion of work set to be unveiled as part of Microsoft's E3 conference next month in Los Angeles.
Some staff have already been made redundant at Crytek Budapest, and the studio is to now focus on work for tablet devices.
Crytek managing director Avni Yerli would not expand on the talk of layoffs or specific projects, stating only that "we can confirm that our Budapest studio is getting a new direction and focus."
Codename Kingdoms was first shown in teaser trailer form last year as part of Microsoft's E3 conference, and is a first-person fighting game using Crytek's bleeding edge CryEngine technology.
It's also an important title for Microsoft's Kinect peripheral, aimed squarely at the core audience in a market known for sports, party and music games such as Dance Central and Kinect Sports.
Crytek Budapest focusing on the tablet market is also a significant shift for Crytek, known for tech-heavy games for the home consoles and high-end PCs.