Pathfinder publisher Paizo has revealed a sweeping slate of changes that include layoffs, and it's all thanks to millions of dollars in stock being held by the company's old distributor.
In a sobering announcement, the company (which is responsible for some of the best tabletop RPGs, including the sci-fi Starfinder) revealed that it's facing the "devastating" loss of almost $2 million thanks to its old distributor, Diamond, going bust and holding onto around $10m in Paizo goods. Paizo then had to write off "nearly half a million in additional sales covered by the bankruptcy." Book-trade sales also "remain far below historical levels," so even though there's been growth via Paizo's online store and hobby retailers in that time, it's not been enough to offset those blows.
Heartbreakingly, this has resulted in layoffs across the company (12 staff are impacted). Thanks to the rising cost of making scenarios for organized play, Paizo is making changes there too. Along with reducing the number of scenarios it produces to two per month as of October 2026 (one for Pathfinder and one for Starfinder), it's stopping free non-Society PDFs for volunteers and putting more emphasis on community-created content. More specifically, it is "bringing independently created Pathfinder and Starfinder products directly into the spotlight on Paizo.com."
Broken diamond
In terms of what led to its downfall, Diamond cited "unexpected loss of certain exclusive publisher relationships, compounded by an overall contraction in consumer spending, increased inflation, and a loss of margin on key print product lines" in an FAQ at the time of the bankruptcy.
In the meantime, the situation with Diamond continues to grind on. Indeed, the incident isn't just limited to Paizo; in the company's post, it notes that "dozens of other publishers" have been in court to see their product released. Seeing as Diamond owed D&D publisher Wizards of the Coast and Hasbro over $1,900,000 at the time it filed for bankruptcy, I can certainly believe it.
The situation doesn't look as though it's going to be resolved any time soon, either. Paizo's exclusive contract with Diamond prevented it from moving forward with a new distributor, and despite a judge having terminated that contract earlier in 2026 (allowing Paizo to partner with Independent Publishers Group to "rebuild our book‑trade presence"), Diamond has appealed the termination which is delaying this whole situation.
Still, there is hope. The company is apparently in a better position now than it was in 2025, though it sounds as though it'll be a long road to recovery.
If this has you feeling down and you want to distract yourself with something new to play, check out the best board games or the best card games.
