Compulsion Games is now listed as the publisher for its upcoming title, South of Midnight, on Steam, indicating a complete separation from Xbox Game Studios. This change, first noted by indie developer Michael Klamerus, comes after Xbox spun out Compulsion as one of four studios to operate independently during a recent organizational reset that also involved significant layoffs.
While Compulsion Games has taken over publishing duties for South of Midnight, Xbox Game Studios still remains listed as the publisher for other studios that have gained independence. This includes Double Fine's Psychonauts 2 on Steam. Similar situations are currently true for Undead Labs' State of Decay 3 and Ninja Theory's Senua's Saga: Hellblade II, although these studios have reportedly been acquired by publishers yet to be formally announced. The implications of these shifts for future game releases and studio relationships within the broader Xbox ecosystem remain to be seen.