Netflix closes Night School and plans Moonloot shutdown six weeks after Unhinged

Netflix closed Los Angeles-based Night School Studio on August 13 and plans to shut Helsinki-based Moonloot. The decision arrived six weeks after Night School released Unhinged, a 30-minute first-person horror game streamed to Netflix TVs. Netflix is also cutting positions on its internal games team, but it did not disclose the number of affected jobs.

Night School is best known for the narrative adventure Oxenfree. Netflix acquired the studio in 2021, after which it released Oxenfree II and a mobile game connected to an episode of Black Mirror. Moonloot was founded in Helsinki in 2022 to develop games inside Netflix's organization.

Netflix attributed the closures to a narrower set of priorities: children's games, party games, story-led projects, and games attached to mainstream properties. The company is not leaving games altogether. A central team working with external developers remains, as does Helsinki-based Next Games, which makes several of Netflix's party games.

The timing puts the focus on Unhinged. Netflix co-CEO Greg Peters recently told investors the game had posted solid numbers, according to Game File, yet its developer closed six weeks after launch. Netflix has previously shut Team Blue and Boss Fight and sold Spry Fox back to its founders as it reduced its owned-studio operation.

Reaction in the Reddit thread centered on Night School. Several players said they had not known Netflix owned the Oxenfree studio, while fans of Oxenfree and Afterparty questioned why a narrative-focused team did not fit the revised strategy. Other comments pointed to Netflix's fragmented game access across phones and supported TVs as a reason players often did not know which games were available.

What players should watch

Netflix has not announced whether either studio's current projects will move to another team.

No service or availability change has been announced for the Oxenfree games or Netflix's current catalog.

The remaining games organization will continue TV and PC streaming work and partnerships with outside developers.