Subnautica 2 in Crisis as Krafton Clashes With Former Leadership

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Last week, Microsoft faced a series of challenging situations that demanded attention. Amidst this, certain news stories took a backseat. For instance, Techland, the developers behind “Dying Light,” announced cancellations for two upcoming titles (one being a fantasy RPG, though fortunately, no job losses were reported). Electronic Arts (EA) has also decided to shut down servers for “Anthem” in January 2026. However, the state of affairs at Unknown Worlds Entertainment, creators of “Subnautica,” and the circumstances surrounding its upcoming sequel have spiraled into something far more significant.

On July 2nd, Krafton, who bought the developer back in 2021 for $500 million, unexpectedly declared that their top management – co-founders Ted Gill, Charlie Cleveland, and Max McGuire – were being replaced by Steve Papoutsis, effective straight away. Notably, Papoutsis is recognized for his contributions to Dead Space but has also been leading Striking Distance Studios, known for the controversial The Callisto Protocol. Now as CEO, Papoutsis aims to deliver Subnautica 2 as a more polished and fulfilling addition to the series – one that truly meets player expectations, according to the publisher.

It’s clear that the player base was taken aback by this sudden turn of events. Unknown Worlds had been consistently sharing Development Log videos, leading many to anticipate an early access launch this year. However, it wasn’t until a few days later that we fully understood the impact of this decision on the former leadership. Yet, it appears that the studio anticipated potential backlash and promptly issued a statement. During this transition period, with Papoutsis taking over as CEO, they also sought to reassure players by confirming that the core team responsible for the project over the past few years remains the same.

Following the mix-up regarding Krafton’s financial report that hinted at the upcoming “Subnautica” being a “multiplayer live-service game,” the studio wishes to alleviate any concerns. They confirm that the game will primarily be a single-player experience, offering an optional cooperative multiplayer mode. There will be no subscriptions, no loot boxes, no battle passes, and no microtransactions.

Initially, the team had put their heart and soul into creating the game, as one of the co-founders, Charlie Cleveland, shared on Reddit. He mentioned that they believed it was ready for an early access release, and fans were eager to play it. However, surprisingly, the decision to release the game was no longer in their hands but in those of the publisher, Krafton. This revelation, after so many years of dedicated work, left Charlie feeling disappointed as he could no longer work at the company he had co-founded. Unsurprisingly, this news sparked a new wave of criticism against the publisher, but things were only just starting to take a turn for the worse.

According to Jason Schreier’s report from Bloomberg, the release date for Subnautica 2 has been pushed back to next year despite the wishes of previous leadership. This delay could potentially prevent Unknown Worlds Studios from meeting specific revenue targets set by 2025. If they had managed to meet these targets, the studio was expected to receive a substantial $250 million bonus, which would have been distributed among all employees. Given that this potential reward could amount to millions for each worker, Krafton’s reasons for the delay were seen as even more questionable. Keep in mind, though, that this is based on the information currently available.

In the following developments, Unknown Worlds revealed a sneak peek trailer for Subnautica 2, scheduled for early access in 2026, and explained the delay. The reasons provided included gathering feedback, enhancing certain aspects, and adding more content such as new biomes, tools, and creatures. Rest assured that it’s still being developed by the original team at Unknown Worlds.

The community perceived this as an attempt to rectify the situation, as they were already suggesting a boycott of the title. Regardless of whether a boycott would be successful or not, a Reddit post with 55,000 upvotes (alongside other factors) was certainly unwanted negative publicity for the studio.

As a devoted follower, I wasn’t expecting this turn of events, but Krafton didn’t shy away from the unexpected. They chose to unveil the reasons behind their leadership change, right on their official website.

As a gamer, I’ve heard that an astonishing $250 million bonus was set aside for the studio’s co-founders, with the expectation they’d lead and engage in the creation of Subnautica 2. However, Krafton claims these individuals shirked their duties. The plan was to release the sequel into early access in early 2024, but unfortunately, the timeline has been pushed back significantly. Multiple pleas were made for Charlie and Max to return as Game Director and Technical Director, respectively, but both refused. Moreover, there’s been talk about their lack of involvement due to the failure of Moonbreaker and Cleveland’s focus on film projects instead of Subnautica 2’s development.

As a gamer, I found myself lost and frustrated due to constant changes in direction, causing significant setbacks in the game’s release schedule. The publisher was clearly disheartened by the previous team’s actions, feeling not just disappointed but deeply betrayed by their failure to uphold the trust we had given them. This led us to a tough choice: replacing the executive leadership, a decision that was necessary for our fans and the game’s success.

To clarify, rest assured that the dedicated core team behind Subnautica 2 are fully invested in the game, demonstrating their genuine enthusiasm, responsibility, and devotion. Additionally, it has been pledged that all remaining Unknown Worlds employees who have worked diligently on Subnautica 2’s development will receive fair and equitable compensation, reinforcing their commitment to delivering the rewards they were originally promised.

Is it possible that they’ll eventually get a portion of the $250 million payout, despite earlier uncertainties? The ride remains turbulent as the ex-co-founders have filed a lawsuit against Krafton, with further details expected to emerge soon. Despite his reservations about legal action, Cleveland expressed his conviction that “This situation needs to be rectified.” He added, “Subnautica has been my life’s work and I wouldn’t willingly leave it or the incredible team who have put their hearts into it.” Contrary to rumors, he also clarified that the co-founders did not aim to keep the majority of the bonus.

Historically, we’ve consistently distributed our earnings among the team members, and this practice held true even when we sold the studio. Rest assured, we will also honor the earnouts/bonuses in the future. They truly deserve it for their tireless efforts in bringing this fantastic game to you.

In simpler terms, Schreier noted on ResetEra that Cleveland and McGuire had minimal involvement with “Subnautica 2”. Contrary to Krafton’s claim that the game was struggling without their input, things seem to be running more smoothly now that they’ve left. However, it’s important to consider Gill, who was the CEO at the time, and Papoutsis, the current leader, but their roles aren’t fully explained in this context.

Additional screenshots suggesting cut content for the early release of Subnautica 2 have leaked online. The authenticity of these images is questionable, but the studio’s response has been clear. In an official Discord post, community manager Donya Abramo made it known that the delay announcement was solely from the studio and not Krafton. Abramo also emphasized that only developers at Unknown Worlds are working directly on Subnautica 2. The studio reiterated their commitment to avoiding microtransactions, battle passes, subscriptions, or loot boxes in the game. At this stage, I hope these promises translate into official stickers for the game’s box art and store listings.

Developers have also shared that they’re untroubled by the storyline (which remains unchanged) and clarified that the latest trailer demonstrates actual gameplay instead of computer-generated imagery (CGI). It’s worth noting that the team behind this project continues to maintain openness with their audience, as much as possible.

It seems quite clear that things are not going well and calling it a mess might even be too mild. Some people are questioning whether Krafton’s leadership is shirking its responsibilities. The image many have of Krafton as an unscrupulous corporation, like Alterra in the game Subnautica, may not be far from the truth. However, until the actual lawsuit starts, we won’t know everything for sure. As for Subnautica 2, it remains to be seen how it will fare under these circumstances. One thing is certain: Krafton and Unknown Worlds have a challenging task ahead in terms of public perception, let alone meeting expectations during early access.

Note: The views expressed in this article are those of the author and do not necessarily represent the views of, and should not be attributed to, GamingBolt as an organization.

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2025-07-14 13:43