Netflix closes Night School Studio and Moonloot Games in gaming division reshuffle
The restructuring of Netflix’s video game arm marks a decisive shift away from mobile-focused indie acquisitions, leaving only Next Games and Netflix Games Studio as primary development entities.
Netflix has confirmed the closure of Night School Studio, the developer behind the Oxenfree series, as part of a broader restructuring of its video game division. The move comes just weeks after the streaming giant’s executives publicly praised the studio’s latest title, Unhinged, for delivering strong performance metrics.
In addition to closing Night School, Netflix plans to shut down Moonloot Games, a Helsinki-based studio it founded in September 2022 to develop original mobile titles. The company is also reducing its in-house games team by an undisclosed number of positions. A Netflix spokesperson told Game File that the restructuring is designed to prioritise kids’ gaming, party games, narrative experiences, and mainstream titles.
The strategic shift follows a period of rapid expansion for Netflix’s gaming arm, which began in 2021. Between 2021 and 2024, the company acquired several teams, including Cozy Grove creator Spry Fox and Boss Fight Entertainment, before hiring former Epic Games executive Alain Tascan to lead the division in 2024. Night School Studio, acquired in September 2021, produced Oxenfree II: Lost Signals, the Black Mirror: Thronglets app, and Unhinged, a smartphone-controlled horror game released approximately six weeks prior to the closure announcement.
The timing of the shutdowns contrasts sharply with comments made by Netflix co-CEO Gregory Peters during the company’s Q2 2026 earnings call on 16 July. Peters highlighted Unhinged and the FIFA World Cup: Launch Edition as the platform’s two most successful cloud game debuts, citing "really solid numbers" that placed them in the top tier of game performance for the company.
With the closure of Night School and the planned shutdown of Moonloot, Netflix has now shut down or sold all but one of its studios. Spry Fox purchased itself back from Netflix and continues to operate independently. The remaining primary entities are Next Games, which focuses on couch-based experiences, and Netflix Games Studio, which primarily signs deals with external developers. This consolidation follows similar turbulence in the sector, with third-party developer Refactor Games laying off 85 per cent of its staff in early August after parent company Delphi Interactive reportedly pulled funding for the FIFA World Cup title.
Night School co-founders Sean Krankel and Adam Hines had previously expressed optimism about the acquisition, citing creative autonomy and support for remote workers when they joined Netflix in 2021. The studio’s final output included the TV horror experience Unhinged and a mobile game tied to the Black Mirror franchise released in 2025. The restructuring signals a departure from the earlier strategy of acquiring and publishing mobile-focused indie titles in favour of TV-based party games and broader mainstream appeal.
The sole survivors at Netflix are Helsinki-based Next Games, which focuses on couch-based experiences, and Netflix Games Studio, which mostly signs deals with external developers. That group seems to be going strong, with a slew of streamable party games like Overcooked! All You Can Eat and Jackbox titles hitting Netflix in recent months.
