Microsoft Reshapes XBOX: Selling Off Ninja Theory & Undead Labs, Double Fine & Compulsion Games Go Independent

One of the biggest conversation drivers surrounding XBOX in recent weeks is the soon approaching reset. In a memo released by Asha Sharma & Matt Booty, the next 100 days for the platform will introduce a ‘reset for a stronger XBOX’. Part of the discussion includes reshaping its internal studios. One report pointed towards multiple layoffs as well as potential studios to shutter.

Studios potential affected are: Double Fine Productions, Undead Labs, Compulsion Games, and Ninja Theory. According to insiders, it was understood the new Senua announcement was made in anticipation to sell off the team. Initially, Ninja Theory alongside Double Fine were understood to be planned for full closure. Undead Labs was the latest to be reported for a complete closure as well.

According to a new memo from Microsoft, it is revealed that the four studios are departing from XBOX Game Studios. However, the talent will instead go under new ownership outside of Microsoft or establish an independent standing as prior to the acquisition made by Microsoft.

Since 2018, we have aggressively expanded our studio portfolio while the number of games created each month across the industry now outpaces the last ten years combined. We now find ourselves competing not only with the largest publishers, but also with smaller independent studios. It is neither possible nor desirable to own every great independent studio. We have also learned that we are not the best home for every type of studio; in a typical year, we lost 64 cents for every dollar we invested. As we reset XBOX, we will help independent creators succeed by providing open development tools and audiences to realize their vision.

Compulsion Games and Double Fine Productions will return to management and transition to independent studios with their IP, catalog, and runway for their next games. Ninja Theory and Undead Labs have entered terms to join new ownership with funding to complete and grow Senua and State of Decay 3. In France, Arkane’s management is beginning required consultation with its Works Council to review potential strategic options.

Asha Sharma, XBOX CEO

On X, both Double Fine Productions & Compulsion Games issued statements on the new change for XBOX and the affected studios. “Once again, Double Fine Productions will be an independent studio. We’re thankful to everyone at Xbox for seven great years together, and for working with us to reach an outcome which preserves our history and culture, and returns ownership of our games to us,” studio head Tim Schafer writes in the letterhead.

“Today, we’re sharing that Compulsion Games will return to independent management following our time as part of XBOX. As part of this transition, we will retain the rights to Contrast, We Happy Few, and our award-winning South of Midnight,” Compulsion Games shares. “We’re grateful for the years we spent with XBOX, for the support they provided our team, and for the opportunity to bring these games to players around the world. As an independent studio, we’re excited to continue building the distinctive games that define Compulsion while taking the next steps in our journey.”

Are you surprised by this new update for XBOX Game Studios?

Source: XBOX Wire