to be fair, people seem to lose their jobs in the game industry even with a commercial success. Recent memory that marvel team game.
This has more to do with how the Video Game industry has folded itself into the larger Hollywood driven Entertainment Media industry. Big title video games are now produced the exact same way block buster movies are.
First a production company will decide to make a product and start gathering capital investment for that product. It will then either use an existing studio or spin up a new one. Resources (people/money) will be assigned to that studio, and most importantly
all debt associated with production.
The studio will develop, market and sell the entertainment product, the production company will charge the studio ridiculous consulting and service fee's. Those fee's are then used to pay of the original capital investors at their agreed upon rates. The investors
always get paid first. If this leaves the studio in the red it's not a big deal because the production company owns the studio as a subsidiary and can just dissolve it and all the debt goes with it, effectively shielding both the production company and investors from financial responsibility.
Most developers now are just contractors hired for specific projects. Make the product, support the product for a period of time afterward, but then have the contract terminated or their division shutdown until another project is needed. Where this gets dicey is when it involves a formerly independent studio. Independent studio makes a bunch of successful products, then gets bought by a major production company. All those successful IP is transferred to the production company and the studio now becomes a disposable asset.