South of Midnight Dev First Xbox Studio Hit by Layoffs

south of midnight Developer Compulsion Games has laid off a number of employees, and it looks like it's starting a potentially much larger round of layoffs across Xbox and even studio closures. south of midnight It was released in April 2025 to solid critical acclaim, but it doesn't seem to have moved the needle as much as it needed to, which has led to the team being influenced by Xbox's latest restructuring efforts.

The recent Xbox Games Showcase featured a lot of interesting titles, but it didn't take long for the mood to sour. One of the most striking exhibits was something new. Senua Ninja Theory's game, Microsoft announced the studio's closure just days after the event. However, Ninja Theory's closure crystallized very quickly, with subsequent sources claiming that Double Fine and Compulsion Games were in “active negotiations” about a potential spinoff. Considering that Compulsion did not announce that it would take its own path, it is highly likely that this discussion was canceled.

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Compulsion Games Dev talks about research and representation in South of Midnight.

Game Rant speaks with Compulsion Games studio head Guillaume Provost about South of Midnight's origins, design, and player reactions.

South of Midnight developer obsessive gaming hit by layoffs

As Rebs Gaming reported on Twitter, Compulsion Games has suffered mass layoffs, putting many employees out of work. Especially while many former employees are posting about their work experiences. south of midnightThere is no specific mention of Compulsion Games itself being shut down. This means that rumors of a studio closing have not been confirmed or denied, but the Rebs believe it is definitely true. Developers currently out of work include writers, narrative designers, 3D and concept artists, and dialogue designers, with more likely to come in the future.

but south of midnight Although it found an audience early on, this did not seem to be enough to sustain the studio in its current configuration. Compulsion Games' previous release was in 2018. we are happyThis is a suggestion south of midnight It took a very long time to make. This was also a major financial investment for the Xbox that doesn't seem to have paid off in the end, but it's hard to say without sales numbers. The only thing known is that over a million players donated. south of midnight These photos were taken less than a month after launch, and by any measure these are impressive statistics.

What is that weapon?

Check out the silhouette before time runs out.

What is that weapon?

Check out the silhouette before time runs out.

Easy (7.5 seconds) Medium (5.0 seconds) Hard (2.5 seconds) Eternal Death (2.5 seconds)

It is now clear that Microsoft is not satisfied with the performance of its gaming division and subsidiaries over the past few years. There have been claims that Microsoft is considering selling the entire Xbox, which means the problems and shake-ups won't stop at Ninja Theory, Compulsion Games, and Double Fine. A systematic rework of the entire Xbox ecosystem may be needed, and new CEO Asha Sharma appears intent on making it a success. Dozens of developers will inevitably be affected along the way, and the real impact on the industry won't be visible for years.

Double Fine's response to the alleged closure is unclear at this time. The studio has released numerous beloved games over the years, including: Psychonaut 2The latest release appears to have flown under the radar. multiplayer broiler kiln This game has received generally positive reviews, but it is a representative example. Double Fine in particular has been rather productive of late, with an unusual puzzle adventure coming out in 2025. conciergeSo Xbox may be more keen on keeping the team around for the time being.