Entertainment news and discussion on TalkFuse.
Netflix’s gaming branch ain’t doing so good as two more studios are getting shut down
Netflix is closing two of its game development studios, Night School Studio and Moonloot, in a further retrenchment of its gaming division. The decision affects the creators of Oxenfree and signals continued uncertainty over Netflix’s first-party games strategy, despite the company maintaining a catalogue that includes externally developed titles.
Night School was acquired by Netflix in 2021, while Moonloot was founded in 2022; the number of affected staff has not been disclosed. Netflix is also reportedly cutting roles at other studios, following last year’s closure of Boss Fight and the sale of Spry Fox back to its original owners.
In short
- Netflix is closing Night School Studio and Moonloot.
- The cuts extend to other Netflix game studios.
- It follows previous studio closures and divestments.
Steelman: both sides, in good faith
The strongest fair case each way — we don't pick a winner.
The case for
Netflix's decision reflects sound business judgment given gaming's capital intensity and uncertain returns. The company has invested billions without achieving the subscriber growth or revenue it anticipated, and continuing to sustain underperforming studios whilst competing against vastly better-resourced companies like Microsoft and Sony represents poor capital allocation. Netflix should concentrate on its proven streaming strengths rather than pursue a peripheral venture generating limited value.
The case against
Netflix's repeated studio closures demonstrate insufficient commitment and unrealistic expectations for a medium that requires sustained investment to develop. The company possesses the financial resources, subscriber base, and content expertise that could support gaming success, yet it has neither invested adequately nor given studios sufficient time to build franchises. Gaming represents a growing strategic opportunity that Netflix should approach as a long-term investment rather than abandon after limited attempts.
Explained simply
Netflix, best known for its film and television streaming service, has also tried making games. It has added games to its membership and bought or set up studios to develop titles of its own.
Night School Studio, which made the adventure game Oxenfree, joined Netflix in 2021. Moonloot was founded two years later. Their closures follow other changes to Netflix’s games business, including the closure of Boss Fight and the sale of Spry Fox back to its founders.
The changes raise questions about how much Netflix will invest in games made by its own studios. The company can still offer games developed by outside partners, so its games catalogue may continue even as its in-house plans shift.