Xbox Layoffs Appear To Be Starting With South Of Midnight Dev Compulsion
Layoffs at Xbox appear to be getting underway, with developers at South of Midnight studio Compulsion Games now seeking new opportunities. This marks the beginning of a broader restructuring effort under new Xbox CEO Asha Sharma, who has reportedly outlined plans for a significant shakeup within Xbox Game Studios. According to recent reports, several studios may either be shut down or transition to independent status.
The future of Compulsion Games remains uncertain. Earlier in June, there were indications that Xbox was preparing to close the studio, although its leadership was said to be in discussions with Xbox about potentially spinning the studio off independently. These developments have been confirmed through individual developers’ posts on LinkedIn, which were compiled by reporter Mr. Rebs.
Compulsion's Background
Based in Montreal, Compulsion Games was founded in 2009. The studio gained recognition for developing Contrast and working on We Happy Few before being acquired by Microsoft in 2018 as part of a wave of studio acquisitions. Since then, it has been part of Xbox Game Studios, contributing to the South of Midnight IP.
What's Next for Xbox?
The Compulsion layoffs may just be the beginning of a larger restructuring plan. Asha Sharma has been pushing for major changes to get Xbox back on track, promising a "reset" for the business. According to Bloomberg, Microsoft is likely to announce layoffs after June 30, the end of its fiscal year.
Other studios, including Double Fine and Ninja Theory, are also reportedly in negotiations with Xbox to either become independent or avoid closure entirely. However, there have been no recent updates on the status of these talks—aside from a cryptic emoji posted to Double Fine's X account.
