[johnnyanmac]

I don't like the term "overhiring" in these discussions because it implies that these studios didn't estimate the costs of development and see layoffs as a mark of failure.

Neither are true. They took a gamble with low risk and the low risk became normal risk. Layoffs often come with a small stock rise, so they aren't even shamed by shareholders for trimming down. It's devastating for employee morale but that's rarely a factor in these decisions.