Microsoft reportedly add Arkane and their Blade game to the potential shuttering pile

Jul 01, 2026 - 01:11
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Microsoft reportedly add Arkane and their Blade game to the potential shuttering pile

They also may have the chance to be acquired by someone else

Blade is pulling a sword from behind his back, a blood red background lighting his face. Image credit: Arkane/Marvel

There's a lot of whispers about studios shutting down around Microsoft and Xbox at the moment. They've been primarily fluttering between Double Fine, Ninja Theory, and Compulsion, but this week has now seen State of Decay developer Undead Labs added to the list of "companies Xbox bought to build up Game Pass but are ultimately shuttering because they've done a bad job at making line go up." And now yet more reports have emerged, with what remains of Arkane potentially being put up on the chopping block alongside the cancellation of Blade.

This comes from The Verge, whose sources relay a few details. For one, Blade was apparently originally scheduled for this year, but the internal date slipped to next year. The game has also apparently gone over budget. Microsoft are also looking to potentially sell Arkane, which has been the general belief about all the studios they're trying to shed, but The Verge notes that talks around such acquisitions could take months in some cases.

Now, the big date to look out for is July 6th. According to the sources that spoke with The Verge, this is when layoffs at Xbox are set to start taking place, and will affect most areas within Xbox. The number could hit up to 1000 in losses, but as The Verge notes, if the five studios currently being deliberated over are ultimately closed, that's 500 more roles gone even outside of Xbox itself.

Blade isn't the only game being affected by Microsoft's brutal and apathetic cost cutting measures. IO Interactive's yet to be properly revealed Project Fantasy has lost what they refer to as their external partner, which Bloomberg has reported is in fact Xbox. Hideo Kojima's mysterious horror game OD, on the other hand, is apparently fine according to IGN, even as Microsoft are desperately trying to find ways to save money.

As always, solidarity to all devs affected by these changes.

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