A week later Microsoft and Xbox started A massive streak of 3,200 layoffs across the gaming brand has been “reset” Having seen 1,600 developers let go with immediate effect and four studios left the company, Compulsion Games – one of the teams left out – has now hinted at how it intends to move forward.
In new post On LinkedIn, the studio behind the action-adventure games We Happy Few and the award-winning Xbox title 2025 South of midnight reaffirmed that it will continue as an independent developer, while also announcing that it is “expanding collaboration opportunities with studios across the games and entertainment industry.”
“With Compulsion Games returning to its roots as an independent developer, we are expanding our collaboration opportunities with studios across the games and entertainment industry,” Compulsion said in a statement.
“We invite partners to tap into the talent and creativity of the award-winning team behind South of Midnight, which has won a BAFTA Award, a Peabody Award, seven Canadian Game Awards and has been recognized on many ‘Best Games of 2025’ lists,” he said.
Although not a huge success for Microsoft and Xbox commercially, South of Midnight was extremely well reviewed by critics and gamers alikeand Compulsion took home several major awards, as highlighted here. We rated it 4/5 our own visionstating, “presents a story full of trauma and beauty, with its unwelcoming magnificent world.”
Notably, in the past Compulsion has contributed to the development of games such as Darksiders and Dungeons & Dragons: Daggerdale, all the way up to its debut puzzle-platformer title Contrast. Now the developer hopes to work with other studios again.
“With our deep experience in creating popular original IP, we bring our artistry, technical expertise and collaborative approach to every project,” the announcement added. “We’re excited to support the development of memorable experiences that engage and entertain players around the world.”
The removal and downsizing of Compulsion Games from Xbox was part of a broader effort by Microsoft. Reorganize the gaming business after “over-expansion”, With the new CEO of Xbox Asha Sharma refers to the brand “move faster” with and focus on its greatest features as Fallout, The Elder Scrollsand Hello.
Games like South of Midnight, which have less sales power than huge established franchises, wouldn’t fit well with this strategy, resulting in Microsoft and Xbox canceling Compulsion. This is a departure For many – myself included – it was frustrating to see – as we know, it came with layoffs … but at least I’m glad the studio will continue.
As for what its developers will be working on, either alone or with other teams in the industry? Only time will tell. Whatever it is Next up for Compulsion Games, but hopefully it will be a project that their staff is passionate about and will be successful enough to give the studio stability. has become an extremely volatile time for game development.
What kind of game would you like to see from Compulsion Games next? Which studio(s) should partner and collaborate with? Let me know what you think in the comments.
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