Netflix closes AAA game studio before it ever released a game

The first cracks are starting to show in Netflix’s push into gaming. First reported in Game File and confirmed by Netflix, the streaming company has quietly closed of one of its studios, the first in the three years since the company began its foray into gaming.

According to Game File, the shuttered studio was known as Blue. In 2022, Netflix announced it hired former Overwatch executive producer Chacko Sonny to run the studio. Since then, Blue had brought on a number of game industry veterans with experience working on high profile franchises including Halo and God of War. Reportedly, Blue was developing a multi-platform AAA game for an original IP but was closed before the game could be announced or released.

Netflix has released a steady stream of games on its platform since the beginning of its gaming experiment in 2021. Though it started with a small handful of hyper-casual mobile games, Netflix’s offerings have expanded to include mobile exclusive ports of iconic games like Grand Theft Auto and Hades its own internally developed exclusives like Cozy Grove: Camp Spirit and Oxenfree II: Lost Signals.

Netflix has also acquired or spun-up a number of studios to support its gaming pipeline. The most recent additions were a mobile game studio in Helsinki, a new studio in southern California, and Cozy Grove developer Spry Fox. But with the closure of Blue, Netflix’s trend of expansion may be over as well as its grander AAA ambitions.