Netflix shuts down Night School and Moonloot as it narrows gaming focus

Netflix has closed two more of its owned game studios — Night School and Moonloot — as part of an ongoing restructuring of its gaming division. The closures were reported by Game File, and Netflix confirmed the move in a statement.

Netflix says it's narrowing its focus to specific categories: games for kids, party games, story-driven titles, and games with what the company calls "mainstream hooks." "We see an opportunity to be more focused in our execution, so we are making organizational changes to the business to match those priorities," Netflix told Game File. The timing is striking for Night School in particular — the studio's horror game Unhinged, a cloud-playable title available through the Netflix app, had just been praised by co-CEO Greg Peters as one of "our two most successful cloud game debuts" during an investor call. The other title Peters cited was a FIFA World Cup game from Refactor Games — a studio Netflix laid off 85% of earlier this month.

The pattern here is hard to ignore: Netflix publicly celebrates a studio's work, then cuts it anyway. Despite touting a 600% year-over-year increase in gaming engagement back in July, the company appears to be pulling back from broad gaming ambitions rather than doubling down. Netflix was also reportedly uninterested in acquiring Warner Bros.' gaming assets before that sale fell through, and a separate report suggested Netflix once considered buying EA — which has since been taken private by a group that includes Saudi Arabia's Public Investment Fund.

What's left of Netflix's internal game development operation is now pointed squarely at a narrower, more casual audience. For studios that don't fit that mold, the message from Netflix is clear — critical success and even the CEO's praise offer no protection from the next round of cuts.