Xbox Probably To Shut South of Midnight Developer Compulsion Games

An award-winning studio is going through closure. Insider Gaming sources can affirm Xbox is planning to shut South of Midnight developer Compulsion Games.

News of the pending closure was first reported by Ethan Gach and Rebekah Valentine at Kotaku.

Speculation of the studio’s future started to select up late final week and over the weekend. In that point, a number of sources, together with high-level staff at Compulsion, spoke to Insider Gaming beneath the situation of anonymity.

UPDATE: According to Kotaku’s Valentine, “Compulsion leadership is in ‘negotiations’ with Microsoft over the studio’s fate, but the details of these negotiations have not been disclosed.”

Despite work being in progress on the subsequent sport on the studio, staff say that there was “worry” and “fear” for months. After Phil Spencer stepped down earlier this 12 months, that concern grew as many stated they felt modifications have been going to return down beneath new management.

“It didn’t matter who took over,” one supply stated. “We all talked about what it meant for us. No one was confident we’d be ok.”

Another high-level worker stated that the messaging coming into the studio didn’t do something to calm nerves.

“Nothing was definitively said [about Compulsion being in trouble], but there was nothing said to assure us that things were okay,” they stated. “We were just left hanging when the topic would be brought up. Just feels like a matter of time.”

Released in April 2025, South of Midnight was obtained positively by critics, even profitable a Peabody Award within the Immersive and Interactive class. Commercially, nonetheless, the sport failed to satisfy inner expectations at Xbox.

The Montreal-based studio at the moment employs round 90-100 individuals. It was acquired by Xbox in 2018.

Xbox didn’t reply to Insider Gaming’s request for remark by the point of publication.

In different information, learn in regards to the struggles surrounding the event of the subsequent Ghost Recon sport at Ubisoft. And for much more Insider Gaming delivered on to your inbox, join our publication.