DON’T NOD Warns Funding May Not Carry It Beyond January 2027 as 90 Jobs Face Cuts

DON’T NOD is facing one of the most serious financial periods in its history, with the French developer and publisher warning that there is material uncertainty over its ability to continue operating beyond January 31, 2027 unless additional external financing can be secured. The studio behind Life is Strange, Vampyr, Banishers: Ghosts of New Eden, Lost Records: Bloom & Rage, and Aphelion is also preparing a major restructuring that could eliminate up to 90 positions in France as it attempts to reduce costs and reshape its development operation around a smaller number of projects.

According to DON’T NOD’s H1 2026 financial update, consolidated gross cash declined from €15.4 million at the end of 2025 to €9.8 million at the end of June 2026, before falling again to €8 million at the end of July. Based on its available cash and current cash flow forecasts, DON’T NOD says continued operations beyond January 31, 2027 partly depend on obtaining outside financing for both normal business activities and future game development.

The deterioration is also visible across the company’s operating results. Revenue reached €6.1 million during H1 2026, down 14% from €7 million during the same period in 2025. More significantly, total operating revenue declined 56%, falling from €13.9 million to €6.1 million after the company recognized no capitalized production costs during the period. Operating EBITDA deteriorated to a €4.3 million loss compared with a €2 million loss during H1 2025.

Sales revenue fell to approximately €3.5 million, supported by Lost Records: Bloom & Rage revenue from PlayStation Plus and Xbox Game Pass, initial sales of Aphelion, and DON’T NOD’s existing game catalog. Development revenue increased substantially to €2.6 million, primarily through work being completed by the Montreal team on an upcoming narrative game based on a major Netflix intellectual property. However, this increase was not enough to offset weaker game sales and the wider financial pressure facing the company.

The accounting treatment of DON’T NOD’s current development pipeline also highlights the funding problem. Production costs associated with Aphelion and the currently unannounced Project P14 were not capitalized during H1 2026. DON’T NOD specifically said P14 did not meet the required capitalization criteria related to its ability to secure financing as of the reporting date, despite receiving expressions of interest. The company has been attempting to secure financing for P14 since at least its 2025 financial results.

DON’T NOD is now responding by restructuring its French operation around a single production line. The company says the new structure will retain the skills required to begin future projects before existing productions are completed while concentrating resources on priority developments. The proposed transformation could result in the elimination of up to 90 positions in France. DON’T NOD’s board approved the launch of the process on September 4, with discussions beginning with employee representatives and the union representing company workers.

"This first half of the year confirms the major challenges facing our industry."
— Quote by: Oskar Guilbert

Guilbert said the company must adapt its business model as financing becomes increasingly selective and game revenue more unpredictable, describing the restructuring as difficult but necessary to maintain DON’T NOD’s operations. The company says it is also examining additional legal, financial, and operational measures designed to support the restructuring and preserve business continuity.

The warning does not mean DON’T NOD will automatically close on January 31, 2027. The date represents the point beyond which its auditors and financial forecasts identify material uncertainty under the company’s current financing position. Additional investment, publishing agreements, project financing, further cost reductions, or other strategic transactions could extend that runway. However, the reduction from €15.4 million in cash at the end of 2025 to €8 million by the end of July demonstrates how quickly the available financial buffer has been shrinking.

DON’T NOD had already acknowledged similar concerns earlier in 2026. Its full year 2025 results warned that continued operations depended partly on external financing, while the company reported €17.4 million in cash consumption during 2025 despite reducing investment expenditure and implementing restructuring measures. Tencent remains a shareholder, but reporting earlier this year indicated it did not plan an additional short term investment in the studio.

The most concerning number is not simply the 14% revenue decline. It is the speed at which DON’T NOD’s available cash has contracted while its operating losses remain substantial. Moving from €15.4 million at the end of 2025 to €8 million only 7 months later leaves very little room for another expensive development cycle without additional financing.

DON’T NOD still owns significant creative expertise and a recognizable portfolio of narrative games, but original premium titles have become increasingly expensive and difficult to finance. The proposed reduction of up to 90 positions could lower operating costs, yet cutting development capacity also creates a difficult balance for a studio whose future revenue ultimately depends on successfully producing new games. The coming months will therefore be defined less by another release announcement and more by whether DON’T NOD can secure enough capital and commercial partnerships to stabilize its pipeline before January 2027.

Do you think DON’T NOD can recover through a smaller development structure and new financing, or does the studio need a major publisher or investor to secure its future?