Don’t Nod Could Face More Layoffs as Studio Struggles With Its Finances

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Don’t Nod is preparing another major transformation of its business, and considering the Life is Strange studio’s financial situation, there is now a very real possibility that further job cuts could follow. The French developer and publisher announced what it calls a “transformation project” designed to adapt its operating model to the increasingly difficult economics of the video game industry.

Management began consultations with employee representatives on September 3, including discussions that could eventually lead to a Plan de Sauvegarde de l’Emploi, or PSE. In France, that is the formal process used when larger-scale redundancies are being considered. Don’t Nod has stressed that layoffs are not confirmed at this stage, but the timing is difficult to ignore.

Earlier this year, an auditor warned that the company could run out of available cash by November without additional financing. Don’t Nod reportedly had around €8.8 million available at the time, while major shareholder Tencent declined both additional investment and co-production funding for projects in development. The studio has since been examining other options, including work-for-hire projects, earlier releases and further cost reductions.

Unfortunately, employees have already been through something similar. Don’t Nod proposed cutting dozens of positions from its Paris studio in late 2024 before negotiations and voluntary departures reduced the final number of forced layoffs.

The company says the latest restructuring is about remaining competitive rather than losing confidence in its developers. Still, with financing becoming increasingly difficult and another formal consultation process now underway, the next few months could be extremely important for Don’t Nod.