Marvel Studios Reportedly Suffers Layoffs Amid Development Issues

By Klein Felt Updated:
Marvel Studios Disney Plus Characters

According to insiders, layoffs have hit Marvel Studios, leaving the future of Marvel Studios Animation in limbo. 

The animation team assembled at Marvel Studios hasn't been as front and center as it should be in the future (having only released What If...? and I Am Groot up to this point), but it has been working away in the background on plenty of MCU content including, What If...? Season 2, Marvel Zombies, and Spider-Man: Freshman Year. 

Marvel Studios Animation has seemingly had a shoe-string budget from the get-go, which was on display in last year's What If...? where the team had "dimly lit sets" and take "some queues from film noir" to get around budget constraints. Trouble also seemed to be afoot for Spider-Man: Freshman Year, with tweets from the series' artists indicating that the show (and its crew) was in turmoil ahead of Season 2.

If layoffs/cuts were to come to Marvel Studios, it feels like the animation department would be the first to be in trouble. And it seems, at least reportedly, that may be the case for the team behind the studio's animated adventures. 

Reported Staff Cuts at Marvel Studios

Marvel Studios Animated What If

According to noted insider KC Walsh, Marvel Studios Animation could be at risk of cuts, as Marvel Studios weighs its financial future amid development issues at the division.

Walsh tweeted ominously that he's "concerned Marvel Animation is going to become a failed experiment," causing a flurry of questions coming in about information the journalist seemingly knew. 

He followed this up in his replies, telling fans he is hearing "some shows are in trouble," suggesting some of the MCU's animated series could be undergoing production problems behind the scenes.

The insider also noted that "layoffs are happening" with "creators [not knowing] what their future holds:"

"Alredy hearing some shows are in trouble, lay offs are happening and creators don’t know what their future holds"

Walsh said he has "heard layoffs will happen at animation" and that "seasons won’t be green-lit until [Marvel Studios sees] the performance of the previous season."

He noted that this becomes a problem because Marvel Studios can't wait for such performance benchmarks, as "they will lose all the creatives behind those shows." This is because "animation development takes too long," so "animation development takes too long" just to see if they get a green light from the MCU higher-ups.

What's Next for Marvel Studios Animation?

What If Marvel Studios

For fans of Marvel's animated adventures and animation overall, this is going to be disappointing news if proven true. Animation takes money and time, more money and time than Marvel Studios sees worth it at this point. 

With a live-action show or movie, Marvel can make the investment, and the relative return on investment compared to the time taken makes sense. But these animated shows are not the billion-dollar money-makers that their live-action ventures can be and don't have the potential of being such. 

The first season of What If...? received a relatively lukewarm response, which may have influenced the switch-up of the show's head writer. Perhaps Marvel Studios is taking the reception of its animated fare into account before doubling down on its offerings.

So if Marvel is weighing the options and needing to make cuts as the inflationary spiral climbs ever upwards, then Marvel Studios Animation, from a financial standpoint, makes a lot of sense. 

But on the creative side, this is a huge bummer. When Marvel Studios announced it was devoting a whole wing of its MCU business to animated properties, it was an exciting prospect. Finally, the super-powered giant was branching out into uncharted waters. Animation is an "infinite canvas," as Marvel Studios Head of Animation Brad Winderbaum once described it, but MCU animation may not be long for this world. 

It will be interesting to see if these cuts and policy changes are made, just what actually comes out and what gets announced next. Surely, things like What If...? Season 2 and Spider-Man: Freshman Year are far enough along to get a full release, but what about those beyond that?  

It's a scary prospect, as creators may simply leave because they are left in the dust without any idea of what to work on next for Marvel until the studio sees the sort of numbers it needs.

- About The Author: Klein Felt
Klein Felt is a Senior Editor at The Direct. Joining the website back in 2020, he helped jumpstart video game content on The Direct. Klein plays a vital role as a part of the site's content team, demonstrating expertise in all things PlayStation, Marvel, and the greater entertainment industry.