Netflix shuts down Night School Studio weeks after Unhinged hit top-tier numbers

Netflix is closing Night School Studio, the Los Angeles developer behind Oxenfree and Oxenfree 2: Lost Signals, just six weeks after the studio shipped its latest game, Unhinged. Also shutting down is Moonloot, a Helsinki-based Netflix studio that had been developing an unannounced life-sim and never released a title.

The timing is striking: co-CEO Greg Peters called Unhinged one of Netflix's "most successful cloud game debuts" on a July 2026 investor call, saying it put up "really solid numbers that put it in the top tier of game performance for us." The first-person narrative horror game, made in collaboration with Weapons director Zach Cregger and starring Sadie Sink and Zoë Kravitz, launched June 30 and was described by reviewers as a "fun and scary choose-your-own-adventure" experience. A Netflix spokesperson framed the closures as a focus move: "We see an opportunity to be more focused in our execution, so we are making organizational changes to the business to match those priorities."

Night School is the latest in a string of Netflix game studio shutdowns. The streamer closed Team Blue in 2024 — a studio it founded in 2022 that never shipped anything — and shut down Boss Fight Entertainment earlier in 2025 after acquiring it in 2022. Netflix described that closure as part of a "less-is-more strategy on a few identified verticals." Peters acknowledged the gaming push is still modest relative to Netflix's overall content spend, saying the company plans to "calibrate and refine" its investment level based on what's actually delivering returns.

At least one Night School developer spoke out on LinkedIn, writing that despite directing Unhinged and shipping it to "millions of excited, satisfied players" just six weeks ago, they're now back on the job market along with the rest of the studio. Netflix says games remain part of its entertainment offering going forward — just with fewer internal studios building them.