Dreamhaven, the game company founded in 2020 by Blizzard Entertainment co-founder Mike Morhaime, has announced layoffs impacting an undisclosed number of employees. The cuts primarily affect the company’s publishing group, according to a statement shared on LinkedIn.

“These choices are never easy, they affect talented colleagues who have played a key role in building Dreamhaven’s foundation,” Morhaime wrote. “From organizing the Dreamhaven Showcase to helping launch three games, every person has contributed to sharing our games with the world. I’m deeply grateful for their creativity, dedication, and hard work. They will be truly missed.”

Financial Struggles Behind the Decision

The layoffs arrive less than two weeks after a Bloomberg report revealed that Dreamhaven was facing financial challenges. Morhaime reportedly told employees in an internal email that “our monthly expenses are outpacing revenue,” emphasizing that the company needed to “urgently reduce costs” to ensure survival.

High Expectations, Modest Results

When Dreamhaven was first announced, expectations were sky-high. With Morhaime’s track record on some of Blizzard’s biggest franchises, like Warcraft, Diablo, StarCraft, Hearthstone, and Overwatch, many fans believed Dreamhaven could deliver the same level of success.

However, the company has struggled to replicate that momentum. Sunderfolk, developed by Dreamhaven’s Secret Door studio, was well-reviewed but peaked at just 890 concurrent players on Steam. Wildgate, released shortly after, fared better with a peak of 7,799 players, but has since dropped to just over 500.

Dreamhaven also published external titles like Lynked: Banner of the Spark, which currently has a peak of only 11 concurrent players, and took over Mechabellum in 2025 after developer Game River split with Paradox. While Morhaime said Dreamhaven remains “committed to supporting these games and the communities forming around them,” the numbers highlight ongoing struggles.

What Happens Next for Dreamhaven?

Dreamhaven confirmed that the layoffs are limited to the publishing group, stressing that “ongoing development of Wildgate, Sunderfolk, and other projects is not affected.” Still, the cuts raise questions about the company’s long-term sustainability in an increasingly competitive industry.

For now, Dreamhaven will continue supporting its released titles while working to stabilize its financial situation. But for many in the gaming community, the news marks a sobering reminder that even industry veterans like Mike Morhaime are not immune to the challenges facing today’s game developers and publishers.

If you want to get more updates about Dreamhaven and their games, you can visit their official X account.