Microsoft’s reported restructuring of its gaming business may be more extensive than originally expected, with a new report claiming that at least five Xbox Game Studios are now at risk of closure. According to sources cited by The Verge, Microsoft is preparing another major round of layoffs that could affect as many as 1,000 employees across its gaming division. While the company has yet to confirm the report, the latest claims suggest the changes could significantly reshape Xbox’s first-party development lineup.
Among the studios reportedly facing an uncertain future is Arkane Studios, the developer behind the Dishonored series and the upcoming Marvel’s Blade. Sources claim Microsoft has not been satisfied with the pace of development on the Marvel title and had already begun reviewing the project’s progress before discussions about studio closures surfaced. If Arkane is ultimately shut down, the report says Marvel’s Blade would also be canceled, bringing development on the highly anticipated superhero game to an end.
The report also claims Microsoft is exploring the possibility of selling some of the affected studios instead of closing them outright. Arkane is reportedly one of the teams being offered to potential buyers. However, Marvel’s Blade is unlikely to be included in any sale, meaning the game’s future remains uncertain if the studio is no longer part of Xbox.
The reported restructuring follows previous layoffs within Microsoft’s gaming business after the company acquired Activision Blizzard. As Xbox continues to streamline operations, more first-party studios are said to be under review.
Earlier reports also suggested that Ninja Theory, the developer behind the Hellblade series, could be seeking a buyer while continuing work on a new project. It was also claimed that discussions around a potential third Hellblade game may have been used to strengthen the studio’s position during those talks, although Microsoft has not commented on those reports.
According to the latest information, the Xbox Game Studios reportedly at risk include:
- Arkane Studios
- Undead Labs
- Ninja Theory
- Compulsion Games
- Double Fine Productions
The reported layoffs are expected to take place on July 6, although Microsoft has not officially announced any workforce reductions or studio closures. Until the company provides an official statement, the reported restructuring plans remain unconfirmed. If the reports prove accurate, Xbox could soon see one of its largest organizational changes in recent years, with several well-known studios and their ongoing projects facing an uncertain future.
