Krafton Accuses Subnautica 2’s Former Leaders of Betrayal and Abandonment

The behind-the-scenes story of Subnautica 2 just took a dramatic turn. In a new statement, publisher Krafton has publicly blamed the game’s former leadership for derailing development, delaying the release into 2026, and breaking the trust of fans and employees alike. The tone is unusually aggressive for a corporate message, and the fallout is already heating up.

Krafton says that after buying Subnautica developer Unknown Worlds in 2021 for $500 million, it expected key leaders—Charlie Cleveland, Max McGuire, and Ted Gill—to remain heavily involved in the sequel’s development. To make sure of that, it put another $250 million in earn-out compensation on the table, with 90% of that tied directly to those three individuals.

But according to Krafton, that leadership team effectively walked away from the project.

"We feel a profound sense of betrayal by their failure to honor the trust placed in them."

Krafton’s message doesn’t leave room for interpretation. It claims the three former bosses—who were recently fired—stopped contributing meaningfully to Subnautica 2, despite taking on roles as Game Director, Technical Director, and CEO. The studio says it repeatedly asked Cleveland and McGuire to return to their original roles, but both refused.

This comes on the heels of Moonbreaker, another Unknown Worlds project, failing to take off. After that, Krafton says it asked Cleveland to shift his focus fully to Subnautica 2. Instead, they say he turned his attention to a personal film project.

Development, according to Krafton, spiraled from there. Without strong leadership, the game’s direction became muddled, and the schedule slipped. What was once planned for early access in early 2024 is now delayed until sometime in 2026. The publisher claims the current build “falls short of content volume,” and that the lack of progress forced them to step in and make major leadership changes.

What’s more, the legal fight is already underway. Bloomberg’s Jason Schreier reports that Cleveland, McGuire, and Gill are filing a lawsuit against Krafton. That filing is still pending, but it’s likely to include claims around that $250 million earn-out package, which they no longer appear eligible for.

Adding another layer, Krafton says that despite the leadership changes, the main development team behind Subnautica 2 hasn’t changed. That includes the designers, programmers, and artists who have been building the game day to day. Krafton says this team is still fully in place, and that the reshuffle was focused solely on the former executives who, as the statement suggests, weren’t doing the work.

In its statement, Krafton promised that the remaining developers would be compensated fairly. The company said it’s committed to rewarding “all remaining Unknown Worlds employees who have continuously and tirelessly contributed,” but didn’t go into specifics. This is an important point because previous reports suggested that the original leaders had planned to share the full $250 million payout across the studio’s estimated 100 staff members. If Krafton only distributes the 10% they were contractually due, that payout may shrink considerably.

This is already creating debate across the Subnautica community, including on the game’s subreddit. Some players are backing Krafton’s stance, citing long development delays and the lack of clear updates. Others are standing by the original developers who made Subnautica a breakout hit. Charlie Cleveland has already stated publicly that the game is “ready” for early access and said being removed from the company he helped create was a “shock.”

This isn’t the first time Krafton has spoken about the state of the project. Earlier this year, it introduced Steve Papoutsis as the new CEO of Unknown Worlds, saying he would bring “renewed energy and momentum.” Papoutsis previously worked on The Callisto Protocol at Striking Distance Studios. That same announcement claimed the core development team would stay untouched, hinting that Cleveland, Gill, and McGuire weren’t heavily involved anymore.

The bigger picture now involves not just the fate of Subnautica 2, but how leadership transitions are handled when money, delays, and player expectations collide. The timing is important too—Subnautica 2 has been in development for several years, and until recently, there was hope for an early access release sometime this year. That window is now officially closed.

Krafton says it still plans to support the Subnautica series long-term and promises more transparency going forward. Whether the game’s development gets back on track—or if more dirty laundry surfaces during the lawsuit—remains to be seen. But one thing is clear: Subnautica 2 is no longer just a sci-fi survival sequel. It’s now at the center of one of the most public and bitter studio splits in recent memory.