In August 2002, Presto Studios shut down new development after the release of an Xbox title Whacked!. In a statement, Greg Uhler (executive producer) announced the closing of the company:
"Due to business, financial, and personal reasons, Presto Studios is discontinuing software development. Whacked! for the Xbox will be the last product that we ship. The company will remain as a corporate entity for many years, but will not be developing products. A minimal staff, including Michel and myself, will be here until the end of October."
Whacked! for Xbox was Presto Studios' final title before closing its doors shortly afterward. Though still in decent financial shape, Presto was facing an uphill challenge in the transition from the PC to console game market. The directors of the company anticipated a rapidly shrinking PC game market and decided to close the company while it was ahead. A significant number of the creative staff moved on to high-profile roles in motion picture and animation production.