Double Fine lays off approximately one-third of staff
The indie studio, which recently announced plans to become independent from Xbox, has laid off 23 of its roughly 90 employees amid broader Xbox layoffs.
Double Fine, the indie game studio known for titles like Psychonauts and Grim Fandango, has laid off about a third of its workforce. The company confirmed that 23 of its approximately 90 employees are being let go.
The layoffs come shortly after the studio announced it would spin out from Xbox and return to independence. In a statement, studio founder Tim Schafer said the decision was made only out of necessity for the studio's survival, calling it a painful action.
Double Fine has recently released several well-received games, including the meditative platformer Keeper in 2025 and the multiplayer pottery brawler Kiln earlier in 2026. The studio was acquired by Xbox Game Studios in 2019 and had been working on a unionization effort before the spin-off announcement on July 6.
The job cuts are part of a broader wave of layoffs at Xbox and Microsoft, which began this summer and have affected thousands of employees across the company.
