Crytek Crisis: Crytek Going Bankrupt? UPDATED

Troubling news from the Triple-A industry...

Rumors have been circulating of Crytek being in some serious financial trouble.

Crytek, you might know, is the developer of the upcoming Homefront, Hunt: Horrors of the Guided Age, Crysis, and the creator of the famously gorgeous Cry Engine.  They’re a pretty big company, and reliable sources within the company are telling us that they’ve been unwilling or unable to pay their employees on time or even at all.  Apparently it’s been happening for several months now—earlier in March, the following email was sent to Kotaku:
 

“I am an employee in the Frankfurt studio. None of us have been paid last month's salary. It is normally paid before the end of the month. It is 11 days late and none of us have been given an explanation by management. All we have to go on are rumors.  This is not the only sign of troubles at Crytek.”

Later in June, an anonymous Crytek UK employee said this to Kotaku as well:
 

"My reason for reaching out is mainly because there are a lot of people in my situation and it isn't right for a company to not pay staff on time.  People should know that there are a bunch of employees who deserve a better company. These things should not be kept in the dark."

The news is vague and comes to us secondhand, but has been reinforced by similar claims from German Magazine Gamestar, which stated that Crytek’s financial woes stem from the commercial bomb of Ryse: Son of Rome.  The article also stated that “the vultures are circling” and that rival companies are already grabbing the most skilled talent from the Crytek offices and giving them new jobs.  Unsurprisingly, Crytek has been silent on the issue until recently, when they denied there was any problem by releasing the following statement:
 

“Regardless of what some media are reporting, mostly based on a recent article published by GameStar, the information in those reports and in the GameStar article itself are rumors which Crytek deny. We continue to focus on the development and publishing of our upcoming titles Homefront: The Revolution, Hunt: Horrors of the Gilded Age, Arena of Fate, and Warface, as well as providing ongoing support for our CryEngine and its licensees. We have received a lot of positive feedback during and after E3 from both gaming press and gamers, and would like to thank our loyal employees, fans and business partners for their continuous support.”

It looks bad, bluntly, and sounds very similar to what was happening to THQ before eventually collapsed two years ago.  Crytek is a big industry player, and being unable to pay it’s employees, for whatever reason, is an extremely bad sign.  That said, Crytek still had a presence at this years E3, it did reveal a new game (Hunt: Heroes of the Guided Age) three weeks ago, and it hasn’t declared bankruptcy yet.  Now, that doesn’t mean it can still be saved; it’s possible they revealed Hunt less for players and more as an “advertisement” for other developers who might be willing to buy the property off them when they go under, like what THQ did its IP.   It’s equally possible they’re testing the waters to see what projects it can afford to cut and which ones to keep.  Or it could just be isolated incidents and the company is fine--no one here is in a position to difinitively say one way or the other.

UPDATE: According to some new emails published by Kotaku, the Ryse sequel Crytek had been working on has been canceled, and Microsoft may give the title to another studio.  Additionally, Crytek co-founder Avni Yerlisent told his employees not to talk to the press about the missing paychecks and dropped titles, as reported by three seperate employees.  They also shared that Avni Yerlisent still drives to work in his Ferrari, which felt like a "Slap in the face".

I'll keep you all posted as the story develops.