Double Fine Productions was one of a handful of game studios that managed to regain their independence during the recent massive Xbox reset that saw a handful of studio closures, a massive number of layoffs, and additional collateral damage to studios not even under the Microsoft umbrella. The studio, which recently launched Kiln and previously developed the Psychonauts series, announced the layoffs in a post on Bluesky, noting that 23 staff members have been affected.

23 staff members represents roughly a quarter of Double Fine's staff, and the studio notes that the contraction is only necessary due to company financials. In a statement to Kotaku , Xbox said that "Double Fine fully returned to independent management earlier this week, with their IP, catalog, and runway for their next games. As they begin their next chapter as an independent studio, we look forward to seeing what they create next." It's currently unclear if Double Fine has any projects in the works, but it seems likely that there will be delays down the road if anything is in active development.