Following Xbox’s publicly issued “reset” memo, it was clear that Microsoft’s gaming wing was gearing up for even more lay-offs and studio closures. As of right now, the reality of the situation is being told through leaks and reports. While Xbox has yet to make a statement, it appears that three studios are in negotiations regarding their future: Compulsion, Ninja Theory, and Double Fine. There is a very real chance that all three of these development studios will be shut down. There’s also a very real chance that they are not the only ones facing a fight for survival.
Many players are, understandably, not too familiar with the studios that make their favourite games. If you don’t follow the world of games closely, when there’s news of studio closures, the first questions are naturally “Which Xbox games are shutting down? Which Xbox games are cancelled?” That’s where this list comes in: we’ve made it crystal clear which games are being impacted by Xbox’s current business decisions. Take a look through, find your favourite game or franchise, and we’ll let you know how things are looking.
Microsoft’s classic real-time strategy series, Age of Empires, is currently developed by World’s Edge Studio. The developer’s current project, the Raiders of the North expansion for Age of Empires 4, was announced as part of June’s Xbox Games Showcase and is due to launch later this year. So far, there are no reports that suggest World’s Edge Studio is in danger of being shuttered.
Fantasy RPG Avowed launched early 2025 to solid enough reviews but it failed to meet sales targets. While that can put studios in a dangerous position, developer Obsidian Entertainment reportedly still has plans for the world of Eora. That could mean a sequel to Avowed, or it could mean a return to Pillars of Eternity – the duology of isometric RPGs that first introduced the setting. While there’s no official statement to point us in the right direction, both are theoretically viable – Avowed’s design taps into widespread hunger for Elder Scrolls-like games, while a third Pillars of Eternity could prove exceptionally popular thanks to the surge of CRPG popularity following Baldur’s Gate 3.
The fantastic-looking steampunk RPG, Clockwork Revolution, is being developed by inXile Entertainment, the studio that previously created Wasteland 3. Xbox recently announced that Clockwork Revolution will be an Xbox exclusive as part of the company’s re-commitment to console exclusives, and so it seems unlikely that a major piece of Xbox’s plan to please its existing community and build a dedicated customer base would be jettisoned. Currently, there are no reports that indicate inXile Entertainment is planned to be closed.
The ambitious reboot of Fable is being crafted by a team at Playground Games. While it is a multi-platform game in development for Xbox, PC, and PS5, it is nonetheless a key part of Xbox’s plan of focusing on its core popular franchises. Fable was beloved in the 360 era, and Xbox will be banking on a lovingly-crafted reboot to sell well and earn fans. Playground Games seems to be in no danger, not least because it also develops another popular Xbox franchise…
Playground Games is split into two development teams: one working on Fable, and the other dedicated to the Forza Horizon series. That latter team only just shipped Forza Horizon 6, and will now be hard at work keeping it updated and flush with new content. It’s also not unlikely that part of the Forza Horizon team will already be thinking beyond Horizon 6 to what lies in the franchise’s future. Horizon is a key pillar of Xbox, and while the distance between games is growing ever longer (it took five years to create FH6, compared to the three years it took to make FH5, and the two years all prior installments took) as of now, we’re expecting there to be a new game on the distant horizon, so to speak.
While the Forza Horizon series has gone from strength to strength over its almost 15-year lifespan, its parent franchise, Forza Motorsport, developed by Turn 10, fell into decline over the same period. Historically the two sides of Forza traded places, with the more arcade-like Horizon games arriving between installments of the hardcore driving sim Motorsport games. Following the lackluster launch of 2023’s Forza Motorsport, Turn 10 have since been assigned to aid Playground Games with the Horizon series, and Forza Motorsport as a franchise has ceased production.
If Xbox’s brand colour wasn’t green, it’d probably be red – so synonymous is the blood-splattered Gears of War with Microsoft’s gaming division. While the series was originally created for the Xbox 360 by Epic Games, Gears is now developed by one of Xbox’s own studios, The Coalition. Its latest project is Gears of War: E-Day, set to launch this October. As announced at the recent Xbox Games Showcase, it will be an Xbox console exclusive, and thus marks a significant step in Xbox’s big plan: its mini experiment in multi-platform releases is (sort of) over, and E-Day will stay on Gears’ home turf. While Gears 4 and 5 don’t have the reputation of the original trilogy, the series is generally quite popular, and so The Coalition seems to be in a safe spot. Gears will continue.
Currently in early access, Grounded 2 is an unusual project for developer Obsidian Entertainment. This team is best-known for its RPGs, having developed Fallout: New Vegas, Pillars of Eternity, and more recently The Outer Worlds 2 and Avowed. But while multiplayer survival isn’t a major part of the studio’s history, Grounded 2 has been a hit. Much like its predecessor, it’s a comparatively cheaper project than the heavy lifts Obsidian’s RPGs are. While there are questions around the developer’s other projects, Grounded 2 and Obsidian appear to be safe.
The idea of Xbox without Halo is unthinkable. And yet, for the past few years, Halo has felt endangered. Halo Infinite was not the mega-hit Xbox would have been hoping for, both in terms of reception to its open-world campaign and the longevity of its free-to-play multiplayer. Developer 343 Industries would later be a victim of Microsoft’s brutal restructuring in 2023, with many staff laid off. This seems to have been a trigger point for something of a reset for the Master Chief - 343i was rebranded as Halo Studios, the studio’s bespoke Slipspace Engine was retired in favour of Unreal Engine 5, and the next game in the series is a remake of the very first Halo, now dubbed “Campaign Evolved.” So while Halo has experienced troubles, it seems like we can expect Xbox to still push forward with the Master Chief. The green Spartan is safe for now.
One of the world’s best-selling, most enduringly popular games, Minecraft from developer Mojang Studios seems in no danger at all. The original game continues to go strong, with a detailed roadmap for 2026 and another spin-off on the way – this September will see the launch of ARPG Minecraft Dungeons 2, made in collaboration between Mojang and Double Eleven.
Last year saw the launch of sci-fi RPG The Outer Worlds 2. Developed by Obsidian Entertainment, it followed in the footsteps of its predecessor, which in turn followed in the footsteps of Obsidian’s own Fallout: New Vegas – a satirical role-playing game with lots of interesting choices, fantastic writing, memorable companions, and wild weaponry. Unfortunately, The Outer Worlds 2 failed to meet Xbox’s sales goals, and so it will be the final game in the series. The Outer Worlds is over as a running series, although Obsidian Entertainment as a studio thankfully remains in operation.
Developer Double Fine Productions is known for many creative and quirky games, including last year’s brilliant lighthouse adventure Keeper, 360-era metal cult classic Brutal Legend, and remasters of beloved point-and-click games Full Throttle and Grim Fandango. These are the games that have made the studio one of my personal favourites. However, perhaps its most iconic output is Psychonauts – a duology (with a couple of spin-offs) that started waaay back in 2005 on the original Xbox and finally continued in 2021 with the long-awaited sequel. Unfortunately, the future of Psychonauts and all of Double Fine’s games – including the recently released multiplayer game Kiln – is reportedly on the line, as it is one of three Xbox studios believed to be facing closure.
The recently announced Senua marks the continuation of the Hellblade series in all but name. This gritty tale of a psychosis-suffering celtic warrior has been running since 2017, and is developer Ninja Theory’s most enduring series, despite poor performance in terms of copies sold and failing to crack Game Pass’ top 10 during its second game's launch window. Yet despite having only just revealed Senua, Ninja Theory is now one of the three Xbox studios facing closure. Reports suggest that Senua was announced because Xbox believed “the promise of a newly announced game would help draw investor interest in the studio.” It’s currently unclear if an investor will buy Ninja Theory, and thus allow development on Senua to continue. As it stands, we may never see the game completed and released.
2025’s bayou-set adventure game, South of Midnight, had stunning art direction and received solid enough reviews, but it seemed to fly under the radar. That’s not an unusual situation for Canadian studio Compulsion Games – its previous title, BioShock-ish survival game We Happy Few, never quite set the world alight in the way its initial trailer suggested it had the potential to. And its debut game, Contrast, is perhaps better remembered for being the very first PS4 game included in PlayStation Plus than for its own achievements. Unfortunately, such a history seems to have put the studio in danger: it is one of the three developers reportedly planned for closure. While we didn’t expect a sequel to South of Midnight, since all of Compulsion's games have been original creations, this does mean there’s little chance of the studio creating something new.
The third State of Decay game has been a long time coming. Developer Undead Labs has been working on it for at least six years – it was announced at the Xbox Games Showcase in 2020, two years after State of Decay 2 launched. Only this year did we get to see a gameplay trailer, and those years of radio silence could convince anyone that State of Decay 3 was stuck in development hell, and thus Undead Labs was in danger of shut down. However, there have been no reports to suggest the studio is facing closure, and State of Decay 3 is still expected to launch in 2027 on Xbox, PC, and PS5.
For 33 years, id Software has been developing the Doom series, and it seems in no danger of stopping. It announced a new expansion for Doom: The Dark Ages at the Xbox Games Showcase – called Revelations, launching July 7 – and there’s no sign that the studio is in danger of being shuttered.
Developed by Zenimax Online Studios, The Elder Scrolls Online is Bethesda’s long-running MMO. Over its 12 year lifespan so far, it has received eight major expansions and countless updates, with the latest being a season focused on the Thieves Guild. While it had a somewhat rocky start, TESO eventually settled into being a beloved online haunt for Elder Scrolls fans, and the developers hope it will last for over 30 years. Zenimax Online Studios was a victim of Microsoft’s 2025 layoffs, which cancelled a new project it was working on and saw the exit of boss Matt Firor, but currently there is nothing to suggest the studio or TESO is in danger of shut down.
The jewel in Bethesda’s crown, The Elder Scrolls likely has little to worry about when it comes to cancellation. Developed by Bethesda Game Studios, the studio at the heart of Xbox’s Bethesda Softworks wing, the series became an unstoppable force during the era of Skyrim, and so fans eagerly await The Elder Scrolls 6. Xbox knows that TES6 is primed to be one of the biggest games of all time, and so will likely do everything it can to ensure it finally arrives. Recent reports have suggested that new Xbox CEO Asha Sharma is looking to speed up development of The Elder Scrolls.
Second only to The Elder Scrolls is Bethesda Games Studios’ other open-world RPG series, Fallout. It’s been a long time since the developer launched a single-player entry – Fallout 4 is a decade old now – but its multiplayer survival spin-off, Fallout 76, still goes strong with regular updates. Both Elder Scrolls and Fallout are reportedly of particular interest to Xbox CEO Asha Sharma, and so we can expect the post-nuclear roleplaying game to play a major role in Xbox’s future.
Following in the footsteps of PlayStation, which has its Spider-Man and Wolverine games, Xbox is getting in on the Marvel action with Blade. First announced back in 2023, we’ve heard not a single thing about it since. For some, that’s a reason to worry - Blade is being developed by Arkane Studios, the creators of Dishonored and Deathloop. Arkane’s games are typically critical darlings that struggle to find large audiences, and so there’s always the fear that the studio will be closed down. Such fears are not unfounded - Arkane was once made up of two studios, one in Lyon, France and the other in Austin, Texas, but the Austin branch was shuttered in 2024. There is, thankfully, no report to suggest that the Lyon studio is due to meet the same fate.
Developer MachineGames has a strong history with games about fighting Nazis. It was assembled to develop the rebooted Wolfenstein series, of which it has made two mainline entries plus a co-op spin-off. Its latest work, however, is the equally fantastic Indiana Jones and the Great Circle. While so far unconfirmed by official sources, it’s believed that MachineGames is currently developing Wolfenstein 3. It is also working with Amazon MGM Studios to create a Wolfenstein TV show. All that considered, it seems the future of the studio and Wolfenstein is safe.
Between ongoing support for Diablo 2: Resurrected and continual updates and expansions for Diablo 4, Blizzard’s gothic ARPG series is probably in the best position it has ever been. A 25 year old game has a brand new class, and the Lord of Hatred expansion brings Diablo 4’s story to a satisfying conclusion. It seems safe to assume for now that Blizzard’s Diablo team will keep the fires of hell well stoked.
Overwatch's Season 3: Into the Tiger's Den has just launched, bolstering Blizzard’s competitive FPS with even more content. Overwatch has undeniably had a rocky life, starting 10 years ago as a genuine phenomenon and contender for best online shooter of all time, and then spending years struggling to evolve through a misguided sequel and shifts to its core composition. But right now, it is in perhaps its best position since those early halcyon days. You can expect Blizzard to keep Overwatch live and kicking with new heroes and ideas.
World of Warcraft has been trucking along for over 20 years now, and Blizzard seems in no way ready to send its genre-defining MMO out to pasture any time soon. The Midnight Revelations update just dropped, and the main Midnight expansion arrived earlier this year. That expansion is also the middle chapter of the three-part “Worldsoul Saga”, which began in 2024 with The War Within and is expected to end with The Last Titan. Based on typical expansion cadence, it seems sensible to expect that in 2028.
While Xbox’s repeated shutting down of studios means it can often feel that any of its games are at risk of cancellation, there is at least one series that feels practically immortal: Call of Duty. Developed by Activision’s army of FPS studios, there has been a COD game every year for over two decades. 2026 will be no different, with the launch of Modern Warfare 4 in October. While the Call of Duty studios have not been immune to layoffs in the past, the core studios that develop the series – Infinity Ward, Treyarch and Raven Software – are all still operational, as are the many support studios that aid them in the monolithic task of creating annual installments.
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