Microsoft has announced the spinoff of four Xbox game studios, including Compulsion Games and Double Fine Productions, as part of a restructuring effort. Under this transition, both studios will maintain ownership of their franchises and game catalogs. Asha Sharma, CEO of Xbox, confirmed that Compulsion and Double Fine will return to independent management, allowing them to continue developing their own games. Compulsion reflected on its journey and expressed gratitude towards Xbox for their support during their tenure.

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Former Xbox studios Double Fine and Compulsion will keep games after going indie

Xbox CEO Asha Sharma says that they’ll retain their franchises and catalogs.

byJay Peters

Jul 6, 2026, 12:22 PM EDT

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Image: Double Fine Productions

Part Of\ \ Xbox’s ‘reset’: all the news about Microsoft’s looming layoffs and studio closures\ \ see all updates

Jay Petersis a senior reporter covering technology, gaming, and more. He joined The Verge in 2019 after nearly two years at Techmeme.

Microsoft is spinning off four of its Xbox game studios — Compulsion Games, Double Fine Productions, Ninja Theory, and Undead Labs — as part of the restructuring announced today. However, two that are going independent, Double Fine and Compulsion, will get to keep their franchises and games catalogs, according to Xbox CEO Asha Sharma.

“Compulsion Games and Double Fine Productions will return to management and transition to independent studios with their IP, catalog, and runway for their next games,” Sharma says in a memo.

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Compulsion and Double Fine have also shared statements about their futures.

Here’s Compulsion’s:

When Compulsion Games was founded in 2009 as an independent studio, we were just a few dreamers in a leaky old gramophone factory devoted to creating rich storylines and experiences that felt handcrafted. We care about the craft of making games, the stories we tell, the players who experience them, and the assembled creators who put their heart and soul into doing something different.

Today, we’re sharing that Compulsion Games will return to independent management following our time as part of XBOX. As part of this transition, we will retain the rights to Contrast, We Happy Few, and our award-winning South of Midnight. We’re grateful for the years we spent with XBOX, for the support they provided our team, and for the opportunity to bring these games to players around the world. As an independent studio, we’re excited to continue building the distinctive games that define Compulsion while taking the next steps in our journey.

Our immediate priority is to support our team throughout this transition period.

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