New reports and leaks reveal a handful of critically-acclaimed studios that may currently be negotiating with Xbox to attempt to avoid full-on closures.
Ninja Theory, Double Fine, and Compulsion Games Rumored to Be In Danger of Closing
Although Xbox had a very exciting Xbox Games Showcase just a week ago, the company didn’t waste any time moving on from the game announcements and pivoting to plans for a massive corporate restructuring that could result in lost jobs, cancelled projects, and lots of other changes at the company.
Asha Sharma shared a message with the full Xbox team about the realities that the company would have to face in the next 100 days. Although the message didn’t go into solutioning, the sentiment definitely suggested that there might be hard times around and some difficult changes in the near future.
Just a few days later, a few early reports suggest those difficult changes are coming even sooner than expected. A report from The Verge claims that Ninja Theory, the studio behind the two Hellblade games and the upcoming Senua title, is going to close down.
According to The Verge: “Xbox is closing down Ninja Theory, the studio behind the Hellblade series, a source tells The Verge. Staffers were told on a call on Monday about the closure, but they are hoping the studio will find a buyer.”
This news has not been confirmed by Ninja Theory or Xbox at this point. Unfortunately, this is only one of a few studios who seem to be in trouble. Another report, from Jason Schreier at Bloomberg, suggests that Compulsion Games (the creators of South of Midnight) and Double Fine are also in negotiations with Xbox about their futures.
According to Schreier’s report, “Several studios in Microsoft Corp.’s Xbox gaming division, including Montreal-based Compulsion Games and San Francisco-based Double Fine, are in active negotiations to spin off as they try to thwart closure, according to people familiar with the company’s plans.”
Double Fine (the creators of Psychonauts, Keeper, and Kiln) didn’t directly release a public statement, but its social media account did share a one emoji post that seems like a clear acknowledgement of the news stories.
— Double Fine (@DoubleFine) June 16, 2026
Although the three studios haven’t produced a massive financial breakdown in the last few years, each of them have developed multiple critically-acclaimed and popular titles.
These are just the latest developments in what is likely to be a long 100 days of stories as Sharma enacts the next steps in her plan to redefine the Xbox brand and improve profit margins. Yesterday also saw two key figures from the Xbox Game Studios team step down.
Be sure to check back soon to learn more about what is next at Xbox and Xbox Game Studios.
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