Double Fine Productions is becoming an independent studio again as part of Microsoft's 4,800-person layoff round, while continuing development on the multiplayer title 'Kiln'.
Double Fine Productions is in transition. In July 2026, Microsoft cut 4,800 jobs, with 1,600 from the Xbox division, and Double Fine was among the studios set to leave Microsoft's first-party lineup and return to independent status. Xbox CEO Asha Sharma described the move as part of a 'reset' that will reduce the division's workforce by 20 percent by July 2027.
Just a month earlier, at BitSummit PUNCH in Kyoto, the studio had presented its current projects as an Xbox-owned developer. Project lead Derek Brand discussed 'Kiln', a multiplayer title that departs from Double Fine's usual story-driven single-player games. Brand said the concept started from letting players create and fight with their own characters, with pottery chosen as the medium after the team drew faces on a photo of pots. The team took pottery lessons for several months during pre-production. Creative lead Lee Petty spoke about 'Keeper', a wordless single-player adventure released in 2025 about a lighthouse that grows legs and walks. Petty said the idea came from a walk during the pandemic, thinking about what becomes meaningless after humanity disappears.
Both developers said that since joining Xbox in 2019, the studio gained resources without restrictions on creative freedom. They expressed gratitude to Japanese fans and said development on 'Kiln' continues. The layoff announcement did not specify when Double Fine's separation from Microsoft would take effect or how it would affect the studio's staffing or projects.
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2d ago
Microsoft Gaming CEO Asha Sharma announced a "reset" of the business, with 3,200 layoffs planned through the 2027 fiscal year, starting with 1,600 immediate cuts. Four studios-Compulsion Games, Double Fine Productions, Ninja Theory, and Undead Labs-will leave the Xbox umbrella. Compulsion and Double Fine will become independent with their IPs; Ninja Theory and Undead Labs will go to new owners. Arkane France is in consultation. The company aims to reduce management layers and appoint a COO.
6d ago
On July 6, 2026, Microsoft laid off approximately 1,600 employees in its Xbox division, the largest workforce reduction in the division's history. The company plans to cut a total of 3,200 Xbox positions by the end of the current fiscal year. Xbox CEO Asha Sharma sent an internal memo describing the move as an "Xbox Reset," citing the division's profit margin being one-third to one-tenth of industry peers and slowed growth relative to rising costs. Four studios acquired by Microsoft in recent years will regain independence: Double Fine and Compulsion Games under their founders' leadership, and Ninja Theory and Undead Labs through sales. The memo stated that previously announced first-party games will not be canceled, and Microsoft agreed to provide development funding for Ninja Theory's "Senua" and Undead Labs' "State of Decay 3." Arkane Studios has begun labor-management consultations about its future. Employees across Bethesda Game Studios, ZeniMax Online Studios, and Obsidian Entertainment also reported layoffs, with some saying they received no prior warning. The reductions follow earlier Microsoft gaming layoffs of 1,900 in 2024 and over 6,000 in May 2025. The layoffs on July 6 represent half of the 3,200 planned; the remaining cuts are expected within the fiscal year.
Jun 2
At BitSummit PUNCH, held May 22-24, 2026 at Miyako Messe in Kyoto, Double Fine Productions gave a rare interview in Japan. Project lead Derek Brand discussed the studio's upcoming multiplayer title 'Kiln', which departs from their usual story-driven single-player games. Brand explained that 'Kiln' began from the concept of letting players create their own characters and fight with them, with pottery and ceramics chosen as the medium after the team found a photo of pots and drew faces on them. The team took pottery lessons for several months during pre-production. Creative lead Lee Petty spoke about 'Keeper', a wordless single-player adventure released last year about a lighthouse that grows legs and walks. Petty said the idea came from a walk during the pandemic, thinking about what becomes meaningless after humanity disappears. Both developers noted that since joining Xbox in 2019, the studio has gained resources without restrictions on their creative freedom. They expressed gratitude to Japanese fans and said development on 'Kiln' continues.