Full Breakdown
Subnautica 2 Earnout Payment Highlights Legal and Financial Fallout
5/28/2026, 10:32:58 PM
Record Sales Trigger $250 Million Earnout
Subnautica 2’s early-access launch on May 14 generated four million copies sold, a peak of 467,000 concurrent Steam players, and $100 million in a single week, making it 2026’s fastest-selling Steam title. The game’s monthly revenue exceeded the $69.8 million threshold that activates a $250 million earnout clause, representing roughly 35 % of Krafton’s prior-year operating profit. A Delaware Chancery Court ordered Krafton to honor the earnout and reinstate former Unknown Worlds CEO Ted Gill.
Background: Acquisition, Development Turbulence, Lawsuit, and Timeline
Krafton acquired Unknown Worlds in 2021. Development continued amid internal tension, and in the summer of the previous year Krafton dismissed CEO Ted Gill, co-founders Charlie Cleveland and Max McGuire, citing launch delays. The former executives filed a lawsuit alleging the terminations were timed to block the earnout. In March, a court ordered Gill’s reinstatement and mandated the $250 million payment; Krafton subsequently agreed to pay the earnout.
Official Statements & Responses
Krafton asserted that launch delays were Gill’s responsibility and accused the former staff of stealing documents. The court’s opinion recorded CEO Changhan Kim’s view that the earnout was a “bad deal” and warned that dismissal “with cause” would not void the payment. The ruling also noted Krafton’s reliance on ChatGPT advice in forming an internal task force to negotiate the earnout.
Criticism & Opposition
The former executives argue that their dismissals were timed to block the earnout, claiming Krafton sought to avoid the $250 million payout. They contest Krafton’s description of the lawsuit as a demand for a multimillion-dollar payout.
Conflicting Reports & Gaps
The sources do not specify the exact month when revenue first exceeded the $69.8 million threshold, nor do they detail the court’s legal analysis for deeming the dismissals “without cause.” Internal revenue projections cited by the court remain undisclosed, leaving the precise financial trigger ambiguous.
Verbatim Quotes
- “The task force’s mandate was to either negotiate a ‘deal’ on the earnout or execute a ‘Take Over’ of Unknown Worlds,” — Court ruling, Vice-Chancellor Lori Will
- “Over the next month, Krafton followed most of ChatGPT’s recommendations,” — Court ruling, Vice-Chancellor Lori Will
- “resorted to litigation to demand a multimillion-dollar payout they haven't earned.” — Krafton statement
- “ Krafton also accused the staff it fired of having stolen documents in anticipation of subsequent legal action, muddying the waters over their exit.” — Krafton statement
What’s Next
Krafton will continue monthly earnout payments as long as Subnautica 2’s revenue exceeds the threshold, affecting its profit margins and potentially shaping future earnout contracts. The court’s acknowledgment of AI-driven decision-making may also prompt regulatory review of such practices.
