Netflix Shuts Down Night School Studio Six Weeks After Unhinged Launch
Netflix is closing Night School Studio and Helsinki-based Moonloot as part of an effort to streamline its games business, despite co-CEO Greg Peters calling Unhinged one of its most successful cloud game debuts.
A Studio Known for Oxenfree Closes Just Weeks After Its Biggest Launch
Netflix has shut down Night School Studio, the Los Angeles-based developer behind the beloved Oxenfree series, just six weeks after the studio shipped Unhinged, a first-person narrative horror game that its own co-CEO called one of the platform’s best-performing cloud game debuts. The closure also affects Moonloot, a Helsinki-based Netflix studio that had been quietly developing an unannounced life-sim and had not yet released any titles.
A Netflix spokesperson confirmed the news to GameFile, framing the move as a strategic consolidation rather than a response to failure. “We see an opportunity to be more focused in our execution, so we are making organizational changes to the business to match those priorities,” the spokesperson said. “Games continue to be an opportunity for us to expand the variety of entertainment we offer Netflix members.”
That framing is a tough one to square with the timeline. Unhinged launched on June 30, starring Sadie Sink and Zoë Kravitz and created in collaboration with Weapons director Zach Cregger. Reviewers described it as a “fun and scary choose-your-own-adventure” experience. And during a July 2026 investor call, Netflix co-CEO Greg Peters was enthusiastic about it, saying the game delivered “really solid numbers that put it in the top tier of game performance for us” and calling it one of the company’s “most successful cloud game debuts.”
Staff React With Grief and Pride
For the people who made that game, the timing stings. A former Night School staff member wrote about the closure on LinkedIn, describing the situation plainly: “Despite directing Unhinged and shipping it 6 weeks ago to millions of excited, satisfied players, it looks like I’m back on the market (along with the rest of Night School Studio)!”
The post was not bitter, exactly, but the frustration is readable between the lines. “I’m so proud of what we accomplished, and millions of people agree that we made a great product,” the person wrote. “Onward to the next exciting thing.”
That kind of response, equal parts grief and professionalism, has become achingly familiar in the games industry over the past few years. Night School was one of the more distinctive studios under the Netflix umbrella, having built a reputation through the atmospheric, dialogue-driven Oxenfree and its 2023 sequel Oxenfree 2: Lost Signals before pivoting to the more cinematic ambitions of Unhinged.
Netflix’s Broader Pattern in Games
This is not the first time Netflix has closed a studio that never got the chance to fully prove itself. The company shut down Team Blue in 2024, a developer it founded in 2022 that closed without ever releasing a game. Before that, it closed Boss Fight Entertainment in 2025 following an acquisition in 2022, describing that decision as part of a “less-is-more strategy on a few identified verticals.”
The pattern is notable. Netflix entered the gaming space with real ambition, acquiring studios and funding development across multiple genres and regions. But the results have been uneven, and the company’s willingness to walk away from even well-received projects suggests it is still figuring out what kind of games business it actually wants to run.
Peters acknowledged as much during the July investor call. “We’re scratching the surface in terms of what we think the total potential of the space offers for us,” he said, adding that Netflix would “continue to calibrate and refine” its investment level, which he noted remains “very small relative to our overall content spend.”
That relative smallness may be the most clarifying detail here. For Netflix, games are still an experiment at the margins of a massive entertainment operation. For the developers losing their jobs, it was a career.
What remains to be seen is whether Unhinged continues to find players on the Netflix platform now that the studio that built it is gone, and whether any of the talent from Night School lands somewhere that lets them keep making the kind of strange, story-first games they were clearly good at.
Why did Netflix shut down Night School Studio?
According to a Netflix spokesperson speaking with GameFile, the company is making organizational changes to be more focused in its execution, describing the closures as an effort to streamline its gaming efforts rather than a reaction to poor performance.
What was Unhinged and how did it perform?
Unhinged is a first-person, narrative-driven horror game developed by Night School Studio in collaboration with Weapons director Zach Cregger, starring Sadie Sink and Zoë Kravitz. Netflix co-CEO Greg Peters called it one of the platform's most successful cloud game debuts during a July 2026 investor call, saying it delivered top-tier numbers.
What other studios has Netflix closed?
As reported by IGN, Netflix shut down Team Blue in 2024, a studio it founded in 2022 that never released any games. It also closed Boss Fight Entertainment in 2025 after acquiring it in 2022, describing that closure as part of a less-is-more strategy.
What is Moonloot and was it working on any games?
Moonloot is a Netflix game studio based in Helsinki, Finland. According to IGN, it had not yet released any titles but was developing an unannounced life-sim project at the time of its closure.