Don’t Nod faces up to 90 job cuts
The video game industry is currently navigating a challenging landscape, and even established, beloved studios are feeling the squeeze. Don’t Nod, the creative force behind acclaimed titles like Life is Strange, is currently undergoing a significant operational pivot, grappling with systemic pressures that have pushed the studio to reassess its future.
The financial journey has been particularly rough. In 2024, the release of games Jusant and Banishers: Ghosts of New Eden did not meet expectations, leading the studio to temporarily pause development on two new projects. This initial setback set the stage for further financial strain.
The pressure continued into 2025, when the performance of Lost Records failed to provide the necessary boost, prompting the studio to implement layoffs to manage costs. This difficult period was compounded by the broader economic pressures facing the gaming sector, which, as many observers note, is experiencing widespread restructuring.
Looking at the overall financial picture, the performance metrics reflect this struggle. The studio reported a 56% decrease in operating revenue year-on-year, a decline attributed to the highly selective financing characterizing the current video game industry. Furthermore, sales figures in the first half of 2026 saw a decline of €3.5 million, driven by sales and the recognition of revenue streams from services like PS+ and Game Pass.
Adding to the complexity were increased development costs, totaling €2.6 million, largely due to an unannounced collaboration with Netflix for a narrative game based on a major intellectual property. These financial realities have created a material uncertainty regarding the company’s ability to operate as a going concern beyond January 31, 2027.
In response to this environment, Don’t Nod is executing a major refocus. The studio is streamlining its operations in France, consolidating its expertise into a single production line to maximize the potential of its existing talent and projects.
This strategic realignment necessitates a substantial workforce adjustment. The studio has approved a restructure that is expected to involve the reduction of up to 90 positions across France. Negotiations are currently underway with the union as the process moves forward.
This move comes amidst an industry grappling with massive shifts. The sector is currently witnessing severe layoffs, spearheaded by giants like Microsoft and Xbox, which are collectively laying off thousands of workers. This trend suggests that developers are facing an environment where incentives are shifting, prompting a critical look at the entire ecosystem.
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