Don't Nod, the French studio known for narrative adventures like Life is Strange, Jusant, and Banishers: Ghosts of New Eden, has initiated "safeguard proceedings" in an effort to stabilize its financial situation. This legal measure, akin to Chapter 11 bankruptcy in the United States, provides the company with a period of protection from creditors while it attempts to devise a long-term recovery plan.
The company has been facing significant financial challenges since 2024. Despite critical and player acclaim, both Jusant and Banishers: Ghosts of New Eden experienced sales that "fell well below expectations," leading to the temporary halt of work on two new games and subsequent layoffs in 2025. Even after restructuring efforts and achieving "significant milestones" in its plan, the studio continues to struggle.
In a financial update, Don't Nod CEO and Chairman Oskar Guilbert cited the "exceptionally challenging environment" of the videogame industry, particularly the difficulty in securing financing. He stated that the company's current cash position is insufficient to cover the operational and project-related funding requirements. The safeguard proceedings are intended to provide a necessary framework and time to build a sustainable solution, safeguard assets, projects, and expertise, and allow operations to continue.
Safeguard proceedings, available in France for companies facing difficulties they cannot overcome alone, involve an observation period of six to eighteen months. During this time, creditor enforcement actions are suspended, and the company works with creditors to develop a plan for debt reduction and rescheduling, which is ultimately subject to court approval.
Adding to the studio's difficulties, the sales of its latest release, the sci-fi action game Aphelion, also came in "below the Group's expectations," further impacting the company's performance. The studio's restructuring plan includes a refocusing of its French operations onto a single production line, a move that could potentially result in up to 85 employees losing their jobs. Don't Nod has previously indicated that a substantial number of positions were at risk as part of its efforts to navigate the current financial climate.