South of Midnight’s director is blunt about the bill. David Sears told the MinnMax podcast that if he had been the one running Xbox, he probably would not have funded a game like his own, Video Games Chronicle reports.
“Would I have turned off someone else’s money flow before South of Midnight? Yeah, because I’m not completely selfless,” Sears said. “But, you know, it just seems like in hindsight at least, it was unsustainable, so of course, it was going to have a shocking outcome.”
Compulsion Games’ Southern gothic action adventure launched on Xbox and PC in April 2025, then reached PS5 and Switch 2 in March 2026. Microsoft said it drew more than one million players in its first three weeks, counting Game Pass. Sears still describes development as a positive experience and says he wanted to make the game — he just never believed Xbox could keep paying for a slate of distinctive mid-budget projects forever.
He compared the moment to a Cassandra complex: hoping for a surprise hit while warning colleagues that the “money tap” would eventually slam shut. “There’s always a night when Rome burns, and I didn’t know exactly when it would be, but I was always worried about it,” he said. In July 2026 Microsoft’s wider reset cut Compulsion from the first-party roster; rather than shutter the Montreal studio, it let the team go independent again.
Sears had already left Compulsion in March 2025, so he was not in the building for the cut. He still praised Microsoft for spinning studios out instead of repeating older shutdowns such as Ensemble, calling the modern approach “much more humane.”
The comments land against a rough Xbox scoreboard, with content and services revenue slipping and hardware down sharply in Microsoft’s latest quarter. South of Midnight remains available on Xbox, PlayStation, Switch 2 and PC, now as a Compulsion game looking for its next partner rather than an Xbox exclusive in waiting.
