It's one of the bitter ironies of this week in the gaming industry: Netflix has announced the permanent closure of Night School Studio – the Los Angeles-based studio behind the acclaimed adventure Oxenfree. Additionally, Netflix is also shutting down the Finnish studio Moonloot and cutting an unspecified number of positions within its own gaming team.
Why is Netflix Shutting Down the Oxenfree Studio Precisely Now?
The timing is particularly bitter: Just six weeks prior, Night School had made a high-profile new start with Unhinged, a 30-minute first-person horror game for Netflix streaming on TV. Netflix Co-CEO Gregory Peters even explicitly praised the game during the earnings call on July 16, 2026, as one of the company's two most successful cloud game launches, alongside a FIFA title. A few weeks later, the closure followed. Netflix justifies the move with a strategic reorientation: The company aims to focus more on “kids gaming, party games, story-driven titles, and games with mainstream appeal” in the future – classic adventures like Oxenfree apparently no longer fit the mold.
What Does the End of Night School Mean for Oxenfree Fans?
Netflix had already fully acquired Night School Studio in 2021. Since then, under the Netflix umbrella, they produced Oxenfree II: Lost Signals as a Netflix exclusive title, as well as a mobile spin-off for Black Mirror. For fans, the closure primarily means uncertainty: Whether Oxenfree and Oxenfree II will remain playable and maintained is unclear, as is the professional future of the affected developers. From our perspective, this case exemplifies how unpredictable Netflix’s investment in the gaming business has been so far: First, a studio is celebrated and acquired for its creativity, then, despite recently praised figures, the plug is pulled – a pattern that has already affected several Netflix studios in recent years.
Source: GameInformer, PC Gamer
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