Former Xbox studios Double Fine and Compulsion will keep games after going indie
Xbox CEO Asha Sharma says that they’ll retain their franchises and catalog
Xbox CEO Asha Sharma says that they’ll retain their franchises and catalog
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Jul 6, 2026, 4:22 PM UTC
Image: Double Fine Productions
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Jay Petersis a senior reporter covering technology, gaming, and more. He joined The Verge in 2019 after nearly two years at Techmeme.
Microsoft is spinning off four of its Xbox game studios — Compulsion Games, Double Fine Productions, Ninja Theory, and Undead Labs — as part of the restructuring announced today. However, two that are going independent, Double Fine and Compulsion, will get to keep their franchises and games catalog
“Compulsion Games and Double Fine Productions will return to management and transition to independent studios with their IP, catalog, and runway for their next games,” Sharma says in a memo
Compulsion and Double Fine have also shared statements about their futures
When Compulsion Games was founded in 2009 as an independent studio, we were just a few dreamers in a leaky old gramophone factory devoted to creating rich storylines and experiences that felt handcrafted. We care about the craft of making games, the stories we tell, the players who experience them, and the assembled creators who put their heart and soul into doing something different
Today, we’re sharing that Compulsion Games will return to independent management following our time as part of XBOX. As part of this transition, we will retain the rights to Contrast, We Happy Few, and our award-winning South of Midnight. We’re grateful for the years we spent with XBOX, for the support they provided our team, and for the opportunity to bring these games to players around the world. As an independent studio, we’re excited to continue building the distinctive games that define Compulsion while taking the next steps in our journey.
Our immediate priority is to support our team throughout this transition period. We are confident in the future of Compulsion Games and look forward to this next chapter where one thing will remain constant: we will create unique games that tell important stories, all with the goal of touching the hearts and minds of our players
And here’s what Double Fine, the studio behind games like Psychonauts, Keeper, and Kiln, had to say:
Once again, Double Fine Productions will be an independent studio
We’re thankful to everyone at Xbox for seven great years together, and for working with us to reach an outcome which preserves our history and culture, and returns ownership of our games to us
To everyone who has reached out to us these past few weeks: Thank you so much for all your kind words, we’ve been deeply touched by all your messages. We will share more news soon on what comes next
Your continued support is greatly appreciated
Tim & All at Double Fine
As for the other two studios, Ninja Theory and Undead Labs, they have “entered terms to join new ownership with funding to complete and grow” their next announced games, Senua and State of Decay 3, Sharma says
Meanwhile, when it comes to Arkane Studios, which is working on a Blade game, “management is beginning required consultation with its Works Council to review potential strategic options.”
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