According to Gamasutra sources close to the studios in question, publisher THQ has laid off staff at two of its wholly-owned developers, Phoenix, Arizona-based Rainbow Studios and Kirkland, Washington-based Sandblast Games.
The Rainbow layoffs occurred in mid-April, comprising about 30 team members from an unannounced game. According to sources, the production on the project will continue with the reduced staff - and the staff were a minority of the developer's multi-team setup.
Similarly, an unspecified number of layoffs at Sandblast were conducted this week - though it appears that the company will continue work on its current project, Destroy All Humans! Path of the Furon for Xbox 360 and PlayStation 3.
Founded in 1996 and acquired by THQ in 2001, Rainbow Studios is heavily oriented towards racing games. It created the off-road MX frachise, scored a massive hit in 2006 with the multiplatform adaptation of Pixar's animated film Cars. Currently, the company is working on the Wii-exclusive action game Deadly Creatures, in addition to other unannounced titles.
Sandblast Games was formed in 2002 as Cranky Pants Games. It has developed Evil Dead: Regeneration, based on the cult classic film series, as well as several multiplatform versions of THQ projects.
Earlier this month, several former members of Rainbow formed TimeFly Studios to create original titles; the announcement appears unrelated to today's news.
Gamasutra has contacted THQ representatives for further details regarding the layoffs - no response was received as of press time.