Double Fine Productions, the studio behind Psychonauts 2, has conducted layoffs affecting 23 employees as it transitions back to independent operation following its departure from Xbox. Studio head Tim Schafer announced the decision on July 28, stating that the action was taken to ensure the studio's short-term survival and to align its size with its independent status.
Prior to these cuts, Double Fine reportedly employed around 90 people. Schafer emphasized the company's commitment to supporting the departing staff and expressed gratitude for their contributions to the studio's creative endeavors. "The people we are losing were all important," Schafer stated.
An Xbox spokesperson confirmed that Double Fine has returned to independent management, retaining its intellectual property, catalog, and financial runway for future projects. "As they begin their next chapter as an independent studio, we look forward to seeing what they create next," the spokesperson added. The exact nature of the studio's current financial runway remains unclear.
During its tenure with Xbox, Double Fine released titles including Psychonauts 2, Costume Quest 2, and the multiplayer game Kiln. The studio is known for its distinctive, heartfelt games, and while it aims to maintain its creative spirit, the recent layoffs place additional pressure on the remaining team as it navigates its future as an independent entity.