Night School Studio Closes as Netflix Shrinks Its Games Division

Netflix is closing Night School Studio, the Los Angeles team behind Oxenfree, six weeks after the studio released Unhinged on the service. Helsinki-based Moonloot, founded in 2022 and reportedly working on an Animal Crossing-style game, is shutting down as well. Netflix confirmed both closures to Game File and said it is cutting an undisclosed number of jobs from its internal games team.

Netflix tied the decision to a narrower slate: kids' games, party games, story-driven fare, and games with mainstream hooks, the bracket its recent FIFA release sits in.

"We see an opportunity to be more focused in our execution"

— Netflix spokesperson

Oxenfree, the supernatural thriller the studio made before the takeover, won awards on the strength of dialogue that keeps running while you walk. Night School's output under Netflix was small and consistent. Oxenfree 2 arrived about two years after the 2021 acquisition and kept the studio's walk-and-talk horror intact. Thronglets followed, a companion piece to a Black Mirror episode that crossed a god-sim with tamagotchi mechanics and a lot of fourth-wall breaking. Unhinged, released in early July, ran 30 to 45 minutes and starred Zoë Kravitz and Sadie Sink, with Troy Baker in the cast. It streamed to a TV while the player's phone worked as both the controller and the protagonist's phone, taking calls from her friend Claire and holding message threads with her ex and the building superintendent. Setting it up meant scanning a QR code off the TV to open Netflix's controller app, after which the phone's gyroscope pushed a torch beam around a dark apartment during a hurricane blackout. Netflix co-CEO Greg Peters cited its numbers on an investor call.

According to Eurogamer, Unhinged was the kind of interactive narrative experiment worth wanting from Netflix, and reviewer Matt Wales argued the studio deserved more room to make them.

"Night School could, if given more opportunities, be Netflix's secret weapon"

— Matt Wales, Eurogamer

I think Netflix has cut the one part of its games slate that had a reason to exist outside retention charts. The phone trick in Unhinged is the first thing Netflix has done with games that made me want to write about it rather than scroll past. I would still file the game closer to a curiosity than something I would come back to, since it runs under an hour on a single route with no real choice in it, but the idea underneath deserved a second attempt.

Netflix started handing out mobile games with subscriptions in 2021. By 2023, games head Mike Verdu was describing careful growth, more titles and more internal studios, with no job cuts behind him at that point. Engagement tripled that year, helped along by catalogue licences such as Grand Theft Auto: San Andreas - The Definitive Edition on mobile.

Netflix shut Team Blue in 2024, a startup studio led by former Call of Duty and Halo developers that was exploring a high-end first-person game, before it shipped anything. Boss Fight, maker of the Squid Game tie-in, closed last October, shortly after Peters had praised the team to investors; one of its developers now works on the FIFA game at outside studio Delphi. In December, cosy-game studio Spry Fox went back to its founders. Monument Valley 3, released exclusively through Netflix with Ustwo, struggled to find players and was later pulled from the service along with a batch of other traditional games, and Ustwo has gone back to being a PC-first developer.

What remains is a central team that commissions work from external developers and one first-party studio, Next Games in Helsinki, which built most of the couch party titles. Netflix has also moved its games away from mobile downloads and toward streaming to TVs and PCs with a phone as the controller, the setup Unhinged used and the one behind Boggle and Party Crashers, which have kept the Netflix controller app high in the app stores. The structure now mirrors the film and TV side, where Netflix commissions far more than it produces in-house. Sony, Ubisoft, Embracer and Microsoft have all closed or sold studios over the same period, with California teams hit hardest.

An animated show based on DOOM franchise is reported to be in development with Shankar as showrunner and no involvement from id Software, and the Assassin's Creed TV show has begun production in Rome with Roberto Patino and David Wiener running it. Variety reported a live-action Persona series with Christopher Monfette attached as showrunner. Netflix keeps greenlighting adaptations while closing the studios that make original games.

Netflix reported a record quarter in its 2025 profit results, with $6.61 per share on $10.5 billion in sales and operating income up 27% to $3.3 billion, an operating margin of 31.7%, and no subscriber numbers at all, since the company stopped reporting them. Games sit inside that logic as a retention feature rather than a business line, which is roughly how president of games Alain Tascan has described the audience he is chasing. His "8-Year-Olds Aren't Dreaming of PlayStation 6" interview made the argument that hardware matters less to young players than getting into a game on whatever screen is nearby. His pitch is the removal of friction: no console to buy, no controllers to round up for everyone in the room, no download to sit through.

"Kids aren't dreaming of owning a PlayStation 6"

— Alain Tascan

Don't Nod said last year it was making a game tied to a major Netflix franchise, and that is close to the whole public pipeline. The spokesperson's line about games expanding the variety of entertainment on offer is harder to read now that the studio making the most unusual thing on the service is gone.

Read also, Rockstar is premiering Grand Theft Auto VI: An Extended Look on Netflix on August 27 at 3 p.m. ET, with the YouTube upload arriving at 9 p.m. ET, and the cheapest Netflix plan needed to watch it runs $8.99 a month. Our GTA 6 Extended Look schedule breaks the start times down by time zone.