Netflix is closing two internal studios at once—Night School (the creators of Oxenfree) and the Finnish studio Moonloot—and making further cuts in its games division. The reason is a shift in strategy: the streaming giant is moving away from niche indie hits in favor of children’s, party-based, and narrative-driven games with a mass appeal. This decision, announced on August 14, is another blow to the industry, which has lost thousands of jobs in recent months.
And that’s not all. Night School Studio, which Netflix acquired in 2021 as its first games team, lasted under the streaming giant’s wing for only five years. Their last work, the horror game Unhinged, starring Sadie Sink and Zoë Kravitz, was released in early July. The head of Netflix Games called it a success, but the studio was still closed. A clue? The company decided that even strong sales don’t justify spending money on experimental projects if they don’t fit into its new priorities. How do you like this turn of events?
Finland’s Moonloot, founded in 2022, hasn’t released a single game yet—it was working on a life simulation in the vein of Animal Crossing. The closure of this team, like Night School, is part of a larger wave: layoffs have affected not only studios but also other internal divisions at Netflix. The exact number of layoffs hasn’t been disclosed, but it appears to be in the dozens. And that’s just the tip of the iceberg. Just two weeks ago, Refactor Games, the developer of FIFA World Cup: Launch Edition, lost approximately 85% of its staff. Netflix is clearly rethinking its gaming ambitions, and so far, this looks more like a purge than targeted optimization.
In the past two years, Netflix has already shuttered Team Blue (a AAA project with Blizzard and Sony veterans) and Boss Fight, and sold Spry Fox. Now, Night School and Moonloot. What remains? The only internal studio is Next Games (known for Stranger Things: Puzzle Tales), along with partnerships with external developers. Netflix Playground for kids, Netflix Minigolf, and the aforementioned FIFA World Cup are already available. It seems the streaming giant is prioritizing fast, social, and recognizable formats over long-term narrative experiments. And the fate of Oxenfree as a franchise is now in question—there have been no official announcements regarding the transfer of rights.
What does this mean for players? All previously released Night School games will remain in the catalog, but there will be no new projects from this team. If you were expecting a sequel to Oxenfree, it will likely be put on hold or transferred to another studio. Netflix isn’t abandoning games, but it is drastically revising its strategy, and this doesn’t seem like good news for internal development. We’ll keep an eye on developments—more changes could soon follow in the coming months.
