Rare has suffered layoffs in the region of 16 staff, multiple sources have told Eurogamer.
Whilst refusing to confirm staff cuts, Microsoft did issue Eurogamer with the following statement:
"At Xbox, our goal is to constantly create new fun, social and interactive entertainment experiences. As part of Rare's commitment to this goal, we have made a decision to change our development process and methodology at Rare to best support our future projects, this has led to us reviewing the skills and the makeup of our development teams in our business."
The statement concluded: "Rare continues to invest in our people and future projects."
Eurogamer understands that the job losses include some software staff, but the majority are design and project managers. To put the losses into perspective, 150 people worked on Kinect Sports Rivals.
The restructuring at Rare may have something to do with Microsoft's U-turn on Kinect, which will no longer be bundled with all Xbox One consoles. Kinect Sports Rivals also appears to have been a commercial flop debuting at No.14 in the UK Video Game Chart.