Microsoft Has Reportedly Shut Down South of Midnight Developer Compulsion Games

Microsoft is reportedly readying to unopen down South of Midnight and We Happy Few developer Compulsion Games.

Kotaku reports that the layoffs whitethorn full much than 90 staff, conscionable months aft the Canadian workplace was advertizing jobs for a caller IP. Microsoft has yet to comment. Compulsion Games besides developed 2013’s Contrast.

The quality comes conscionable hours aft it emerged that caput of Xbox Game Studios Craig Duncan and main of unit Louise O'Connor had near Microsoft aft decades astatine the company.

South of Midnight, an enactment escapade crippled acceptable successful a fictionalized American Deep South, launched successful April 2025 and portion it was well-received by critics, it failed to find a important audience. It launched connected PlayStation 5 and Nintendo Switch 2 successful March.

Just past week, caller Xbox brag Asha Sharma warned of a institution "reset" that astir took arsenic a awesome that Microsoft planned large layoffs and workplace closures. One expert told IGN "the studios astir exposed are superb for prestige and rotten for the spreadsheet." Microsoft was past said to beryllium speeding up improvement connected caller The Elder Scrolls, Fallout, and Halo games arsenic it considered restructuring oregon adjacent spinning disconnected its gaming branch.

Sharma's ground-shaking memo revealed that Microsoft's gaming concern presently has a 3% accountability borderline (assumed to mean nett margin), which is down year-on-year. "Excluding Activision Blizzard King, implicit the past 5 years, we person spent implicit $20 cardinal connected ongoing investments successful our content, platform, and hardware subsidy, but our yearly gross has declined astir fractional a cardinal during that time. Going forward, this cannot continue," Sharma said.

Following the merchandise of the memo, Microsoft CEO Satya Nadella said "there's much monetization of Xbox games happening connected YouTube" than astatine Xbox, adding the Xbox squad needed to fig retired however to "innovate some successful hardware, arsenic good arsenic successful the games, going guardant successful an economically viable way."

"No 1 tin impeach Microsoft of not having invested for the past 25 years," Nadella said. "Now, we person to crook this into a sustainable concern that delivers what is fundamentally 1 of the champion sources of entertainment, still."

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Wesley is Director, News astatine IGN. Find him connected Twitter astatine @wyp100. You tin scope Wesley astatine [email protected] oregon confidentially astatine [email protected].