Icelandic game studio CCP was one of the first developers to jump on the recent virtual reality craze with its graphically impressive spaceship shooter “Eve: Valkyrie,” but this week the company announced that it is pulling out of VR development entirely and laying off dozens of employees.

CCP, which is best known for its massively multiplayer game “Eve Online,” will close its branches in Atlanta and Newcastle, and the company will also lay off staff in London, Reykjavík and Shanghai. CCP Chief Executive Hilmar Veigar Pétursson told The Iceland Monitor Monday that the decision was “tough, but important.”

“Despite the success of the VR games we have released we will be shifting our focus to our PC and mobile initiatives,” said Pétursson. “We will continue to support our VR games but will not be making material VR investments until we see market conditions that justify further investments beyond what we have already made.”

CCP may not have the same name recognition as major studios working in VR like Bethesda Game Studios Id Software, but the company has released two popular VR titles: “Eve: Valkyrie,” which was released for Oculus Rift and PlayStation VR, and “Gunjack,” a mobile VR title developed for the Samsung Gear VR. In fact, the two games were apparently so successful that Pétursson had a very different outlook on the current VR market earlier this year.

“Even if the VR market is in its early stages, if you’re fortunate enough to have started early and really worked hard at it you can have success in the VR space,” Pétursson told PlayStation Lifestyle in March. “Gunjack now has sold over a half-million copies, which I think is a record – I’m certainly gonna claim it until somebody tells me they’ve sold more.”

CCP’s move shows that while VR is still generating buzz and new investments, the industry may still have some growing pains ahead of it before it can be a profitable medium for many developers. According to Pétursson, CCP intends to stay away from VR development for the next three years, which he believes will give the technology more time to mature and become more widely used by consumers.

Photo: CCP Games