After having been released from Xbox and now becoming an independent studio, South of Midnight developer Compulsion Games has taken to LinkedIn to announce that it is currently looking for partners to work with. In its statement, the studio said that it is “expanding opportunities to collaborate with studios across the games and entertainment industry.”
The decision likely comes after the company’s ownership was handed over to its own management, which in turn has also meant that the studio hasn’t quite managed to secure funding for its next major project. Working with other developers is likely a way for Compulsion Games to start saving up capital that it could then spend on developing a new game.
“We invite partners to leverage the talent and creativity of the award-winning team behind South of Midnight, a game that was honoured with a BAFTA Award, a Peabody Award, seven Canadian Game Awards, and recognized on multiple ‘Best Games of 2025’ lists,” continued the studio. “With deep experience in creating acclaimed original IP, we bring our artistry, technical expertise and collaborative approach to every project. We are excited to support the development of memorable experiences that engage and entertain players around the world.”
Compulsion Games is only the second of the four studios recently released from Xbox to make such a statement. The other companies – Double Fine Productions, Ninja Theory – haven’t made any announcements regarding their future yet. Undead Labs, on the other hand, has confirmed that it is continuing development of its zombie-based survival shooter State of Decay 3.
“Today, Undead Labs begins a new chapter,” said the studio last week. “We’re transitioning out of Xbox, and while we can’t share all the details just yet, we can tell you this: State of Decay 3 is still coming. The team is working hard, and our commitment to this community has never been stronger. More news soon. Survivors stick together.”
Interestingly, while Compulsion Games and Double Fine Productions have been given full independence after being released from Xbox, Undead Labs and Ninja Theory were instead sold to other companies. Details regarding these sales haven’t yet been confirmed, however.
The last game by Compulsion Games – South of Midnight – was released last year on PC and Xbox Series X/S. The title would eventually make its way to PS5 and Nintendo Switch 2 earlier this year. In our review, we gave it a score of 8 out of 10 thanks to its distinct setting, engaging storytelling, memorable characters, and fun combat and traversal. Our only complaints were that the protagonist spoke too much, the gameplay felt a bit too straightforward, and a general lack of polish at times.
Compulsion Games’ independence comes following recent layoffs affecting 1,600 employees throughout Xbox earlier this month. Division CEO Asha Sharma went on to confirm that 1,600 more job cuts were planned for later in the fiscal year, and said in a statement that the layoffs had to happen due to the poor health of Xbox as a company. The company also went through sweeping structural changes, which included the appointment of a new COO.
