Home News Xbox are parting ways with Double Fine, Arkane, Undead Labs, Compulsion, and Ninja Theory in the course of thousands of layoffs
gaming Jul 6, 2026 · 👁 1 views · Syndicated from Rock Paper Shotgun

Xbox are parting ways with Double Fine, Arkane, Undead Labs, Compulsion, and Ninja Theory in the course of thousands of layoffs

After weeks of uncertainty, Microsoft have finally revealed what their big Xbox business "reset" involves. Spoilers: it's not great! CEO Asha Sharma has announced that they will lay off 3200 people over the course of their next financial year, beginning today with around 1600 redundancies. In addition, Microsoft are pa...

After weeks of uncertainty, Microsoft have finally revealed what their big Xbox business "reset" involves. Spoilers: it's not great! CEO Asha Sharma has announced that they will lay off 3200 people over the course of their next financial year, beginning today with around 1600 redundancies. In addition, Microsoft are parting ways with five of their best-known studios: Psychonauts developers Double Fine, State of Decay developers Undead Labs, Senua developers Ninja Theory, South of Midnight developers Compulsion, and Dishonored developers Arkane.

Further details are few, but here are the broad strokes: Compulsion and Double Fine are going indie again, while Ninja Theory and Undead Labs have found unnamed new owners. Arkane's status is unclear: the studio's bosses are currently haggling with a works council of employees over various "strategic options".

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