Electronic Arts (EA) is shutting down legendary game developer BioWare, cancelling the next Mass Effect game and cutting approximately 400 jobs as part of a major restructuring following its US$55 billion takeover earlier this year.

The decision brings an end to one of gaming’s most recognisable development studios, best known for creating the Mass Effect and Dragon Age franchises.

According to Bloomberg, the layoffs will affect around 3% of EA’s workforce, including approximately 50 employees at BioWare. The cuts come just months after EA was taken private in August through a US$55 billion leveraged buyout led by Saudi Arabia’s Public Investment Fund.

The acquisition left EA carrying approximately US$18 billion in debt, increasing pressure on the publisher to reduce costs and improve profitability.

Earlier this year, EA outlined plans to generate up to US$700 million in savings, partly by reducing research and development spending. The latest restructuring appears to be a significant step towards achieving those targets.

In an internal letter to employees, EA Chief Operating Officer David Tinson and Chief Studios Officer Cam Weber confirmed that the company had spent several months reviewing its business and deciding which projects should continue receiving investment.

“Across our portfolio, we’re making deliberate choices to align talent and investments where we see the greatest opportunities for players and long-term growth,” the executives wrote.

Among the biggest casualties is the next Mass Effect game, which had been in the early stages of development at BioWare. Its cancellation effectively brings the franchise’s immediate future to a halt.

BioWare was founded in 1995 and acquired by EA in 2007. The studio built a reputation for story-driven roleplaying games, delivering critically acclaimed titles across the Mass Effect and Dragon Age series.

However, its fortunes have declined in recent years. Games including Mass Effect: Andromeda and Anthem received mixed or negative reviews, while the studio’s most recent release, Dragon Age: The Veilguard, failed to meet EA’s sales expectations.

The disappointing performance of The Veilguard had already resulted in significant staff reductions at BioWare last year, leaving the once-prominent developer considerably smaller than during its peak.

While BioWare is being closed, EA says it will continue investing in several of its biggest franchises.

These include its sports titles, the popular online shooter Apex Legends and the Battlefield series. Development will also continue on the next Star Wars Jedi game and an upcoming Marvel Iron Man title.

EA has also revealed that Respawn Entertainment and DICE will collaborate on a new project, potentially another instalment in the Star Wars: Battlefront franchise, although the publisher has not confirmed its identity.

The restructuring extends beyond BioWare. EA is also cancelling Project Lotus, an unannounced game in The Sims franchise, while shifting resources towards another project known internally as Project Evergreen.

Meanwhile, development of the free-to-play skateboarding game skate will continue, although the team working on it will be reduced.

The sweeping changes highlight EA’s efforts to concentrate its resources on established franchises and projects it believes offer the strongest commercial returns.

For BioWare fans, however, the closure marks the end of a 31-year chapter in gaming history, while the cancellation of the next Mass Effect leaves one of the industry’s most beloved science-fiction franchises facing an uncertain future.