In a nutshell

• Studio Closure: Sony Interactive Entertainment has officially shuttered Bluepoint Games, the Austin-based studio renowned for high-end remakes like Demon’s Souls and Shadow of the Colossus.
• Strategic Shift: The move, confirmed via an internal memo from Sony’s Hermen Hulst, cites “an increasingly challenging industry environment”

Sony Interactive Entertainment is reportedly closing down Bluepoint Games, the studio behind high-profile remakes such as Demon’s Souls and Shadow of the Colossus.

According to a Bloomberg report by Jason Schreier, the move is part of a continued restructuring within PlayStation Studios, affecting roughly 70 employees. Bluepoint Games is expected to close in March after a recent “business review.”

Bluepoint Games Shuts Down After Decades of Technical Excellence

Bluepoint, which Sony officially acquired in 2021 after a long-standing partnership, was widely considered the gold standard for remasters and remakes. Their 2020 launch of Demon’s Souls was a flagship title for the PS5. Since the acquisition, the studio had reportedly been working on original content.

Hermen Hulst Cites Evolving Market Demands

Hermen Hulst reportedly addressed the closure in a company-wide memo, citing the increasingly challenging industry environment and rising development costs.

See below the full statement from Hermen Hulst:

Hello everyone,

I wanted to share an important update from the Studio Business.

As I mentioned in the December Town Hall, 2025 had some strong highlights within PlayStation Studios. Ghost of Yōtei launched to critical and commercial success, Death Stranding 2: On the Beach further showcased our commitment to narrative excellence, and Helldivers 2 and MLB The Show continue to drive on-going player engagement and revenue.

At the same time, we’re operating in an increasingly challenging industry environment. Rising development costs, slowed industry growth, changing player behavior, and broader economic headwinds are making it harder to build games sustainably.

To navigate this reality, we need to continue adapting and evolving. We’ve taken a close look at our business to ensure we’re delivering today while still well-positioned for the future. As a result, we will be closing Bluepoint Games in March.

This decision was not made lightly. Bluepoint is an incredibly talented team and their technical expertise has delivered exceptional experiences for the PlayStation community. I want to thank everyone at Bluepoint for their creativity, craftsmanship, and commitment to quality. Where possible, we will work to find opportunities for some impacted employees within our global network of studios.

While I know this is hard news to hear, I’m confident in the direction we’re headed. Creativity, innovation, and building unforgettable experiences for players remain at the heart of PlayStation Studios. We have a robust roadmap for FY26, with much to look forward to in the months ahead. Thank you for your hard work and continued support.

Best,
Hermen Hulst CEO, Studio Business Group