Don't Nod faces potential insolvency and mass layoffs

Don't Nod, the developer behind the ‘Life is Strange’ series, is facing a severe financial crisis and potential insolvency. According to a statement from the French video game workers' union, Le Syndicat des Travailleureuses du Jeu Vidéo (STJV), the studio has entered a safeguard procedure to avoid being unable to pay its debts.

The union reports that management has presented employees with scenarios that include significant layoffs, with the worst-case prediction being company liquidation within 2026. The proposed redundancies reportedly target nearly all non-managerial positions, including animators, character artists, concept artists, programmers, and sound designers. The union has accused management of illegal practices, alleging that the company is targeting specific individuals rather than roles to decide who remains.

Financial reports from auditors previously warned that the studio could exhaust its cash reserves as early as November. The union also noted that the company may be unable to complete its current project, referred to as P14. A government agency is expected to issue a ruling on the matter on November 3, after which management will have 21 days to finalize a plan. If approved, employees may receive termination notices by November 25.