Rare’s Everwild Canceled After Decade-Long Saga

In a shocking turn for the gaming industry, Microsoft has pulled the plug on Everwild, Rare’s ambitious original IP that had been in the works for more than 11 years. This cancellation coincides with sweeping layoffs across Xbox, highlighting ongoing challenges in game development and corporate restructuring. First teased in 2019, the project promised a visually stunning world but struggled to find its footing despite multiple reboots and hype-building trailers.

The Long and Winding Road of Everwild’s Development

Everwild’s journey began in the prototype phase over a decade ago, evolving into a full-fledged project under Rare, the studio behind classics like Sea of Thieves and the Battletoads series. Announced at The Game Awards in November 2019, it captivated audiences with ethereal trailers showcasing lush, dreamlike environments filled with mythical creatures and cooperative gameplay elements. A follow-up trailer in July 2020 hinted at survival mechanics blended with exploration in a vibrant, otherworldly setting.

However, updates dried up quickly. Rare’s developers reportedly grappled with defining a cohesive vision, leading to internal reboots. Even after these efforts, the game remained shrouded in mystery, with minimal concrete details emerging. This prolonged silence fueled fan speculation and impatience, especially as competing titles like No Man’s Sky and Valheim filled similar niches with successful releases.

• Key Milestones: Prototype started ~2014; Public reveal 2019; Second trailer 2020; Reboot confirmed internally post-2020.
• Challenges: Direction struggles, scope creep, and integration of multiplayer features amid shifting industry trends.

Xbox Layoffs: A Broader Industry Shakeup

The cancellation of Everwild is not an isolated incident but part of Microsoft’s largest layoff wave yet, affecting approximately 4% of its global workforce—around 9,100 employees. Gaming divisions bore the brunt, with Rare facing significant restructuring. Reports indicate team members on Everwild were directly informed of the project’s end, leading to job losses at the studio.

Microsoft Gaming CEO Phil Spencer had, just five months prior in February 2025, publicly stated that Everwild was making “progress.” This assurance now contrasts sharply with the abrupt termination, underscoring the volatility of large-scale game production. Other projects, including The Initiative’s Perfect Dark and ZeniMax Online’s Blackbird MMORPG, were also axed, signaling a portfolio-wide prioritization shift.

This table illustrates the scale of cuts, focusing resources on established hits like Sea of Thieves and Forza Horizon rather than high-risk originals.

Impact on Rare and Veteran Leadership Exodus

Rare, once a powerhouse of Nintendo fame with titles like Donkey Kong Country and GoldenEye 007, has pivoted toward live-service games under Microsoft. Sea of Thieves remains a success story, but Everwild’s failure raises questions about the studio’s ability to innovate on new IPs. Compounding the blow, Gregg Mayles—Rare’s most seasoned designer with over 35 years at the company, credited on Banjo-Kazooie and Conker’s Bad Fur Day—announced his departure following the cancellation.

Mayles’ exit marks the end of an era, as his influence shaped Rare’s creative identity. Sources suggest the layoffs and project death contributed to his decision, leaving the studio to rebuild amid talent drain. Barcelona-based King studio also lost 10% of its staff, showing the layoffs’ global reach.

Official Statement and Microsoft’s Rationale

“We have made the decision to stop development of Perfect Dark and Everwild as well as wind down several unannounced projects across our portfolio. As part of this, we are closing one of our studios, The Initiative. These decisions… reflect a broader effort to adjust priorities and focus resources.” — Matt Booty, Microsoft Studios

Microsoft’s statement emphasizes adapting to a “changing industry landscape,” where ballooning budgets—often exceeding $200 million for AAA titles—and uncertain returns prompt caution. Everwild’s marketing push began six years ago, yet it never reached a playable state for wide testing, amplifying risks.

What Everwild Could Have Been: Visions and Missed Opportunities

From sparse teasers, Everwild appeared to blend shared-world survival with artistic flair, featuring dynamic ecosystems, creature taming, and seasonal changes. Fans imagined it as Rare’s next big multiplayer phenomenon, akin to Sea of Thieves but with a fantastical twist. Developers anonymously shared frustrations over nailing core loops, with reboots failing to resolve fundamental design issues.

In an industry where games like Elden Ring and Starfield succeed through bold risks, Everwild’s demise highlights the fine line between ambition and feasibility. Its cancellation frees Rare to potentially expand Sea of Thieves or revive older franchises, though fans lament the lost potential of this gorgeous world.

Phil Spencer’s Role and Leadership Under Fire

Phil Spencer’s February update painted an optimistic picture: Rare was “making progress” on Everwild amid a diverse Xbox slate. Five months later, the project’s end amid layoffs has drawn criticism for perceived mismanagement. Spencer’s strategy of acquiring studios like Bethesda and Activision aims for scale, but recent cuts suggest overextension.

Industry observers note this as part of a pattern, with previous Xbox layoffs in 2024 and studio closures like Tango Gameworks. Spencer’s assurances may have bought time, but they couldn’t salvage a project adrift for years.

Implications for Xbox’s Game Development Pipeline

Microsoft’s moves signal a conservative pivot: prioritizing Game Pass growth, live-service sustainability, and cross-platform hits over speculative single-player adventures. With Everwild gone, attention shifts to proven assets. Yet, this risks stifling creativity, as Rare’s experimental spirit—once legendary—now contends with corporate metrics.

• Pros of Cancellation: Cost savings, focus on viable projects, reduced burnout.
• Cons: Lost IP potential, morale hit, talent exodus.

Looking ahead, Xbox may announce new Rare endeavors at future events like Gamescom or The Game Awards, but expectations for bold originals have tempered.

Industry-Wide Lessons from Everwild’s Fall

Everwild’s story mirrors broader trends: extended dev cycles (average AAA now 5-7 years), marketing hype without substance, and economic pressures post-pandemic. Layoffs at Microsoft echo cuts at Sony, EA, and Unity, with over 10,000 gaming jobs lost in 2024-2025 alone. Studios must balance innovation with fiscal reality, perhaps leaning into smaller, iterative releases.

For Rare fans, this is bittersweet. While Sea of Thieves thrives with seasonal updates, the void of new IPs stings. Microsoft’s confirmation ends speculation, allowing closure but sparking debates on what could have been.

Frequently Asked Questions (FAQs)

What was Everwild about?

Everwild was envisioned as a cooperative adventure in a mythical world with survival, exploration, and creature interactions, though details remained vague.

Why was Everwild canceled?

Development struggles, lack of clear direction post-reboot, and Xbox’s restructuring amid layoffs led to its termination.

How many jobs were lost in Xbox layoffs?

Approximately 9,100 positions across Microsoft, with gaming heavily impacted, including at Rare.

Is Rare working on anything new?

Rare continues supporting Sea of Thieves; no new projects announced post-Everwild.

Will Everwild assets be reused?

No official word, but prototypes may inform future Rare titles.