Rec Room, once valued at $3.5 billion and boasting over 150 million players, will cease operations on June 1. The Seattle-based social gaming platform announced it could not achieve sustainable profitability, despite significant engagement over its ten-year history. The company attributed its closure to high costs that consistently outpaced revenue and recent shifts in the virtual reality market.
In a separate development, Snap Inc. confirmed it has acquired certain assets from Rec Room Inc. Some employees from Rec Room will transition to Snap's Specs Inc., a subsidiary focused on augmented reality and eyewear products. However, Snap indicated that this move does not imply a revival of Rec Room in its existing form.
Details regarding the number of employees joining Snap and the financial terms of the asset acquisition remain undisclosed. Snap has maintained a Seattle engineering presence since 2015 and is preparing for the anticipated launch of its next-generation Specs eyewear later this year.