Xbox turmoil continues with a studio closure and executive departures

# Xbox turmoil continues with a studio closure and executive departures Source: [https://www.theverge.com/games/949964/xbox-compulsion-games-closure-craig-duncan-departure](https://www.theverge.com/games/949964/xbox-compulsion-games-closure-craig-duncan-departure) Compulsion Games is reportedly being shut down\. Compulsion Games is reportedly being shut down\. by Jun 15, 2026, 5:08 PM UTC   Image: The Verge [](https://www.theverge.com/authors/jay-peters) Jay Peters is a senior reporter covering technology, gaming, and more\. He joined The Verge in 2019 after nearly two years at Techmeme\. Last week, Xbox boss Asha Sharma sent a memo warning of an Xbox “reset” ahead of expected layoffs, and today,[*Kotaku*reported](https://kotaku.com/xbox-shuttering-south-of-midnight-peabody-award-compulsion-games-2000706065)that Xbox plans to shut down Compulsion Games, the studio[behind*South of Midnight*](https://www.theverge.com/games-review/647143/south-of-midnight-review-xbox-compulsion-games)\. Since taking over in February, Sharma has made some big decisions, including[cutting the price of Xbox Game Pass](https://www.theverge.com/news/915928/microsoft-xbox-game-pass-ultimate-price-drop)and making*Gears of War: E\-Day*and*Clockwork Revolution*[Xbox console exclusives](https://www.theverge.com/news/945428/xbox-console-exclusives-return)\. But in their[“reset” memo](https://news.xbox.com/en-us/2026/06/10/next-100-days-xbox-reset/), Sharma and chief content officer Matt Booty discussed many challenges facing the Xbox business, including that it has “over extended” with its studio system: > We are the fortunate stewards of industry\-defining franchises that have enormous potential and player demand, but we have not adequately funded them to compete and win\. At the same time, as we saw this past weekend at Showcase, a reliable pipeline of first\- and third\-party exclusives and new IP are critical to our success\. We need to reassess the balance between these and our investment priorities for the next 5 years\. Last week, my colleague Tom Warren[reported that](https://www.theverge.com/games/948142/microsoft-xbox-layoffs-reset-asha-sharma)Xbox’s changes could “involve a studio closure, or changes to the Xbox studio lineup\.” Xbox didn’t immediately reply to a request for comment\. The company’s head of Xbox Game Studios, Craig Duncan, and the Xbox Game Studios chief of staff, Louise O’Connor, also announced that they will be leaving,[*The Game Business*reported](https://www.thegamebusiness.com/p/xbox-game-studios-boss-craig-duncan)\. Duncan, who formerly headed up Rare, took over the role[in October 2024](https://www.theverge.com/2024/10/14/24269896/microsoft-xbox-game-studios-craig-duncan-promotion)\. In May, Sharma[reorganized the Xbox platform team](https://www.theverge.com/news/923908/microsoft-xbox-reorg-platform-changes), including bringing in some execs that she had formerly worked with on Microsoft’s CoreAI team\. **Follow topics and authors**from this story to see more like this in your personalized homepage feed and to receive email updates\. - Jay Peters ## The Verge Daily A free daily digest of the news that matters most\.