Level-5, the team behind such franchises such as Professor Layton, Ni no Kuni, and PlayStation 2 cult-classic Dark Cloud, is a successful development studio in Japan. While many of its titles have received commercial acclaim, with Yo-Kai Watch becoming one of the most financially successful franchises in Japan since it launched in 2014, recent Level-5 western releases have not seen the same success. Now, it appears that it has halted its North American operations.
The news comes via a GamesIndustry.biz report, whose sources claim that the company has been running with a "skeleton crew" since late August 2019. Both of the publisher's North American offices, Level-5 International America and Level-5 Abby, laid off roughly 20 employees around that time, with the number of remaining staff currently unknown.
According to the report, the reason for the lay-offs is unknown, but employees for Level-5 Abby apparently received clear indication that the office was preparing for closure, with only one or two employees remaining for the publisher to carry out essential functions. Furthermore, its sources said Level-5 Abby's COO Yukari Hayakawa departed the studio in early 2020, while Level-5 International America closed its design department in July 2019.
What this means for North American releases of Level-5's titles remains to be seen. One source implied that Level-5's games would not see western releases following the office's closure. Level 5's current titles include Ni no Kuni: Cross Worlds, an MMO adaptation of the Studio Ghibli-inspired JRPG franchise for iOS and Android, and Inazuma Eleven: Great Road of Heroes, which has been in development since 2018 for mobile, Nintendo Switch, and PlayStation 4. Only the latter has a confirmed localization.
For a number of years Nintendo has been the publisher for many of Level-5's titles outside of Japan, with Bandai Namco publishing the Ni no Kuni series. For Nintendo exclusive Level-5 titles such as Professor Layton and Yo-Kai Watch, much of the localization work was handled by Nintendo internally rather than Level-5's North American studios, meaning that titles within these series' and Ni no Kuni could still see releases in North America.
However, for now this is just speculation. Currently, the only games that have been confirmed for western releases from Level-5 are the aforementioned Inazuma Eleven: Great Road of Heroes and Yo-Kai Watch 4. Level-5's most recent North American release was Snack World: The Dungeon Crawl - Gold for Nintendo Switch on February 14, 2020.
Source: GamesIndustry.biz