'Eyes Of Wakanda' Animation Studio Shuts Down Due To Lack Of Work And Funding

The animation studio behind Marvel Studios’ Eyes of Wakanda series, Axis Studios, has shut down.

A report from Caroline Reid at Forbes reveals the reason for the shut down was a combination of the shutdowns due to the fear of Covid-19, the multiple strikes in Hollywood, and soaring inflation.

An internal document detailed that “the industry experienced a downturn in production commissions post-pandemic, particularly in the video gaming sector which comprised the majority of the company’s client base. The company was also impacted by the US writer strikes which took place from May to September 2023, and the related actor strike which ran until November 2023. These significantly pushed out production schedules. Allied to this, significant cost price inflation, particularly in respect of employee costs, further eroded margins and overall profitability.”

“The company’s workflow was such that only a small number of projects were active at one time and, due to their relatively large individual size, this could produce cashflow pressures until large completion payments were received or in the event significant gaps arose between commissions,” the document added. “Whilst the directors considered there to be a strong pipeline of work, with a significant project due to commence in early 2025, delays in the commencement of projects began to emerge. This resulted in the company experiencing cashflow difficulties, as initial payments – which would normally be received from customers at the commencement of projects – were consequently deferred. As a result of these cashflow pressures, the company was unable to meet its payroll obligations in June 2024 and also had to defer payments to freelance contractors.”

After an insolvency practitioner was brought on to advise the company it was determined that “the company could not continue to trade” due to “the lack of significant ongoing work, the high level of ongoing operational costs, the significant arrears due to employees (by this stage extending to 6 weeks) and freelance contractors and a lack of available of funding.”

It was announced to the 151 employees on July 15, 2024 that the company would shutter.

The most recent report filed at the end of August indicated the company owed a balance of ₤732,000 to Barclays and it was “highly unlikely there will be a dividend to the secured creditor.”

On top of that, the company also owes ₤454,000 in wages to its employees and ₤970,911.05 to the British government in taxes. It is not expected that these will be paid.

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