Debuting earlier this month, Little Nightmares 2 has already been a massive success for Tarsier Studios, amassing great reviews and being hailed as a worthy follow-up to its cult-classic predecessor. Naturally, with the game managing to strike such a chord with players, fan speculation about a third entry has run rampant, however, it seems a return to Little Nightmares isn't currently on the cards for Tarsier.

As detailed via the studio's parent company, Embracer Group, in a Q3 earnings report webcast, Tarsier will be moving on to work on new IPs in the future, with the company's CEO Lars Wingefors claiming "that was the main reason we made this acquisition." Although it's by no means confirmation that Little Nightmares will never return, it definitely suggests that Six's twisted adventures will be put on the backburner for the foreseeable future.

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Speaking on the game, Wingefors explained how he was thrilled to see Little Nightmares 2 become such a critical success, claiming that while the IP is owned by Bandai Namco and has no financial impact on Embracer, it bodes well for the future. "I'm super excited about them achieving such a game again, because the first game was very well received," he claims during the report, revealing that "having that game completed, they will move over to create new IPs." It makes sense for Embracer to pursue new franchises with Tarsier now its finished its work with Bandai Namco, especially considering the studio has already built a very successful brand around both its Little Nightmares games.

Embracer officially acquired Tarsier back in 2019, when the team was well underway working on the recently-released sequel. The deal set the company back SEK 88 million in cash and SEK 11 million in Embracer B-shares, which roughly equates to around $10.5 million. Embracer Group has made a series of investments into a multitude of studios over the years, recently acquiring Borderlands developer Gearbox for $1.3 billion. It also sits atop major gaming publishers Deep Silver and THQ Noric, who own franchises such as Saints Row, Metro, and Darksiders.

As for Little Nightmares 2, the game dropped back on February 11 and has since garnered tons of praise online due to its creepy monsters, striking environments, and high-octane set pieces. Its conclusion left players intrigued by the idea of a sequel, with its story remaining open-ended with a few loose ends in need of tying up. It'll be intriguing to see whether Tarsier's new franchises close the door on Little Nightmares or simply put it on ice while the studio entertains some new ideas.

Little Nightmares 2 is out now on PC, PlayStation 4, Xbox One, and Nintendo Switch, with PlayStation 5 and Xbox Series X versions in the works.

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Source: Embracer Group, GamesIndustry.biz