At least for now, Compulsion Games has survived being under Microsoft’s umbrella, but it remains to be seen what will happen to the studio in the long term.
The action-adventure game South of Midnight, developed by Compulsion Games and originally released in 2025, is now available on Steam as a self-published title. This change has been confirmed by updates on SteamDB. On August 11, the publisher listed on the game’s page changed from Xbox Game Studios to Compulsion Games. This followed Microsoft’s announcement in July that it would be closing five studios and cutting thousands of jobs, including Compulsion Games. Since then, the studios have thanked Xbox for enabling them to become independent, and Compulsion Games has announced that it is seeking partners to develop new projects. It is not yet known whether Compulsion Games will self-publish the console versions of South of Midnight, but the listings on console platforms remain unchanged.
“With Compulsion Games returning to its roots as an independent developer, we are exploring new opportunities for collaboration with studios across the gaming and entertainment industries. We invite partners to leverage the talent and creativity of the award-winning team behind South of Midnight, a game honored with a BAFTA Award, a Peabody Award and seven Canadian Game Awards. It was also recognized on multiple ‘Best Games of 2025’ lists. With our extensive experience in creating acclaimed original IP, we bring artistry, technical expertise and a collaborative approach to every project. We are excited to support the development of memorable experiences that engage and entertain players around the world.” wrote Compulsion Games a month ago.
The studio is not alone in this situation: Double Fine, Undead Labs and Ninja Theory are in a similar predicament. We previously reported that Double Fine was forced to downsize its team. The studio is operational for now, but it would be worth revisiting this question in three months’ time: will they still be around? The answer may be different by then.
