Netflix Games has initiated a wave of layoffs affecting Night School Studio, the developers behind the critically acclaimed indie title, Oxenfree. The exact number of employees impacted remains undisclosed.

Night School Studio, founded in 2014 by Sean Krankel and Adam Hines, was acquired by Netflix in 2021 as part of the streaming giant's expansion into the gaming industry.  Known for their narrative-driven adventure games like Oxenfree, Afterparty, and Next Stop Nowhere, the studio recently released the highly anticipated sequel, Oxenfree II: Lost Signals, in 2023.

The layoffs at Night School Studio come amidst a broader restructuring of Netflix Games.  Reports indicate that the decision, announced internally in January, shocked employees. While the studio's current projects are reportedly unaffected, the move raises concerns about the future direction of Netflix's gaming ambitions.

This restructuring also follows the cancellation of six games in development for the Netflix platform, including titles like Don't Starve Together and Tales of the Shire: A Lord of the Rings Game.  Netflix declined to comment on the specifics of the layoffs.

The company's shift in gaming strategy comes after the closure of their triple-A studio, Team Blue, in October 2024. While former Netflix Games head Mike Verdu has transitioned to a new role focusing on generative AI, newly appointed Alain Tascan, formerly of Epic Games, expressed optimism about Netflix's potential to "redefine the future of gaming."

Unfortunately, the layoffs at Night School Studio are part of a larger trend impacting the gaming industry. Other studios, including Crytek, 10:10 Games, and Hi-Rez Studios, have also recently announced workforce reductions.

The situation underscores the challenges faced by even successful studios in the competitive gaming landscape. The unexpected dismissal of a Marvel Rivals development team, despite the game's success, further highlights this volatility.