Don't Nod obtains safeguard procedure, cash reserves fall to €9.9 million
Don't Nod announced on October 20, 2026 that the Paris Commercial Court had granted its request to open a safeguard procedure for Don't Nod Entertainment SA. The studio published its first-half 2026 results on the same day, which provide context for this decision: gross cash reserves fell from €15.5 million on December 31, 2025 to €9.9 million at the end of June 2026.
The cost-reduction plan launched in late 2024 is producing measurable effects, with a 34% reduction in personnel costs and a 35% reduction in other operating expenses. However, these decreases were insufficient to offset the absence of capitalized production and the decline in sales: economic EBITDA stood at -€4.3 million, compared to -€2.0 million a year earlier.
Revenue of €6.1 million, down 14%
In the first half of 2026, Don't Nod's revenue stood at €6.1 million, down 14%. Economic operating income, which includes capitalized production, totaled the same amount, down 56%, as no production was capitalized during the period. Production costs for Aphelion and project P14 were not capitalized, with the latter currently not meeting the required financing capacity criterion, "despite signs of interest" according to the company.
Sales of €3.5 million derive primarily from PlayStation Plus and Game Pass revenues for Bloom & Rage, initial sales of Aphelion and its integration with Game Pass, as well as from the existing catalog. The group notes that Aphelion sales fell short of its expectations. Development revenues reached €2.6 million, mainly related to the narrative game being developed in Montreal based on Netflix intellectual property.
Economic EBIT came in at -€7.3 million, compared to -€21.9 million a year earlier. The difference is attributable to depreciation charges and provisions, reduced to -€2.7 million versus -€19.7 million, with the first half of 2025 having included €15.4 million in impairments. After financial income of €0.2 million, the group's net loss amounted to €7.1 million, an improvement year-on-year.
Costs down, cash consumption of €5.6 million
Personnel costs declined by €4.3 million, to €8.2 million from €12.5 million. Excluding the effects of restructuring support measures recorded in 2025, the decline reached 25%, or €2.7 million. Average headcount in full-time equivalent terms fell from 279 to 194 people between June 30, 2025 and June 30, 2026.
Other operating expenses came to €4.0 million versus €6.1 million, driven primarily by a €1.6 million decrease in marketing and publishing expenses (only one game published in the half-year, compared to three in 2025) and a €0.6 million reduction in outsourcing following the completion of Aphelion production. The decrease in tax credits (-€1.0 million) also weighed on economic EBITDA.
Free cash flow stood at -€5.2 million, an improvement of €3.5 million, and total cash consumption was limited to €5.6 million, compared to €9.5 million a year earlier. As of June 30, 2026, the group had €12.7 million in equity, non-significant gross financial debt, and a tax credit receivable of €7.5 million, provisioned at €1.9 million for the reimbursement of the Aphelion-related tax credit.
The company indicates that the continuation of operations over the next twelve months depends on securing external financing. It describes this situation as significant uncertainty that could jeopardize business continuity beyond January 31, 2027.
Six-month observation period and up to 85 positions affected
On September 1, 2026, Don't Nod presented a new transformation plan providing for a refocus of French operations around a single production line, with no impact on the Montreal studio. This plan could result in a workforce adjustment affecting up to 85 positions in France; initial information and consultation meetings with employee representative bodies were held according to the announced schedule.
For Oskar Guilbert, chief executive officer, the safeguard procedure constitutes "a forward-looking and protective measure." He clarifies that the current level of cash reserves "does not allow us to secure in satisfactory conditions all the financing requirements associated with our activities and projects."
By judgment of October 19, 2026, the court appointed the SELARL Détroit, represented by Attorney Charles-Henri Carboni, as judicial administrator. The interim financial statements were neither audited nor subject to limited review, and the interim financial report will be published no later than October 31, 2026. The procedure opens an observation period with an initial duration of six months, during which pre-judgment debts are frozen.
