French video game studio Don't Nod is facing a challenging future, with the possibility of ceasing operations as early as 2027, according to a recent statement. The company announced on Friday that it plans to lay off 90 employees in France, following a restructuring effort last year. Based in both Paris and Montreal, Don't Nod has decided to focus its efforts on a single production line in Paris, leading to significant staff reductions. As of the end of July, the studio held 8 million euros in cash, down from 15.4 million euros as of the end of 2025. The company’s continued operations depend largely on securing external financing, which remains uncertain beyond January 31, 2027. Oskar Guilbert, CEO and co-founder of Don't Nod, acknowledged the difficulty of the measures being taken, expressing understanding of the impact on affected employees and emphasizing the company's commitment to providing necessary support. Earlier in 2025, the studio underwent a restructuring plan that eliminated nearly 60 of its 250 Paris-based employees, prompting several days of strikes. Auditors had also raised concerns about the company’s financial health in a report from May, warning of its financial exhaustion. Meanwhile, its main shareholder, Tencent, a Chinese tech giant, has refused to provide financial assistance to the studio. The latest game from Don't Nod, Aphelion, an adventure game set on a distant planet, received mixed reviews, averaging 64 out of 100 on Metacritic. While the Montreal-based studio is not affected by the current job cuts, it is working on a narrative game based on a major intellectual property from Netflix. The French video game industry is currently undergoing a difficult period, with other notable studios also facing challenges. Quantic Dream, known for Heavy Rain and Detroit: Become Human, plans to lay off about 115 employees out of its 400-person workforce in Paris and Montreal. In addition, Ubisoft, a major French game publisher, continues to close studios abroad, including those in Winnipeg and Belgrade, and has laid off more than 4,000 employees since September 2022. Meanwhile, several studios have shut down, and dozens of employees have lost their jobs in recent months due to the judicial reorganization of publisher Nacon. These developments highlight a broader trend of financial strain and restructuring across the French video game sector.