Netflix Is Shutting Down Two of Its Own Game Studios — Just Weeks After Saying They Did Well
Netflix confirmed on August 13, 2026 that it is closing Night School Studio and Moonloot Games, two studios that make games for Netflix, along with an undisclosed number of job cuts across its games team. Game File
Night School Studio, based in the United States, was the first game studio Netflix bought, picked up in September 2021 as the streaming company started its video game business. The studio developed Oxenfree II: Lost Signals, the Black Mirror: Thronglets app, and Unhinged, a horror game you play on your TV using your phone as a controller, with no game console needed. Engadget
Moonloot Games, based in Helsinki, was founded by Netflix in September 2022 to build original mobile games. Its planned closure alongside Night School narrows Netflix's internal game development to fewer studios that it owns directly.
The closures arrive less than a month after Netflix co-CEO Gregory Peters publicly praised both studios' output. On the company's Q2 2026 earnings call, held July 16, Peters singled out Unhinged and the FIFA World Cup game, saying both delivered "really solid numbers" and became Netflix's two most successful cloud game debuts, placing them in the top tier of game performance on the platform. Engadget
A Netflix spokesperson told Game File that the reshuffle is aimed at prioritizing kids gaming, party games, narrative experiences, and mainstream titles like FIFA World Cup: Launch Edition. Game File
That priority list is narrow. Night School built its reputation on story-driven horror and adventure games. Moonloot was founded specifically to create original mobile games. Neither fits cleanly into "kids gaming" or "party games." Netflix is narrowing its focus, concentrating resources on categories it believes will reach large audiences rather than niche or critically acclaimed games.
The timing is jarring. Peters praised Unhinged's performance on July 16. Less than four weeks later, the studio that built it is gone. Either the "really solid numbers" were not solid enough to justify the studio's ongoing costs, or Netflix's internal sense of what makes a game successful has shifted quickly between the earnings call and this decision. Both are plausible given that Netflix's gaming division is still in an early, reshaping stage, but the gap between public praise and closure is unusually tight even for a company still finding its footing in a new area.
Unhinged itself is a recent product. The Verge reported on the game in late June 2026, describing it as a horror experience tied to Netflix's effort to let members play games on their smart TVs. The game was released roughly six weeks before the closure news, making it one of the shortest gaps between a studio's major release and that studio's shutdown. Engadget
Netflix entered gaming in 2021 with a strategy built on three parts: licensing mobile games made by other companies for its subscribers, acquiring or founding its own studios, and building a way for members to play games directly on their smart TVs without a console. The closure of Night School, the company's first acquisition, touches all three parts. Night School produced story-driven mobile games, contributed to the Black Mirror tie-in app, and built Unhinged for the TV gaming effort. Its removal signals that Netflix is willing to close studios that contributed across the full breadth of its gaming strategy, not just those working in a single format.
In my view, this pattern is not unique to gaming. Netflix has done this before in its own history: launch a broad content category, measure how well it performs, and then cut what does not meet internal targets quickly and without sentimentality. The company did this with original film production in certain genres, with interactive specials, and with portions of its animation lineup. Gaming appears to be entering that same phase of aggressive curation, where the question shifts from "what can we build?" to "what is worth keeping?"
For developers and studios considering partnership with or acquisition by Netflix in gaming, the signal is clear. Netflix will invest in talent, ship products, and publicly praise results, and then close the studio weeks later if the broader strategy demands it. The closure of the company's first game studio acquisition, four and a half years after that acquisition, closes a chapter that began with optimism about Netflix as a home for creative game development. What replaces it looks more transactional, more focused on mainstream and party-game formats, and less interested in the narrative and experimental work that Night School represented.
The broader question for Netflix's gaming ambitions is whether a narrowed focus will produce the engagement the company needs to justify the investment, or whether the categories it is now prioritizing can sustain a gaming operation that has already shed its first studios.
