Ninja Theory was showing Senua just last week
Microsoft’s Xbox division may be preparing more studio cuts, according to new game-oriented media reports. Several Xbox studios are reportedly in active talks with Microsoft over their future, including Compulsion Games, Double Fine and Ninja Theory.
First reports claimed that the studios may be closed, but according to Bloomberg, the studios may actually be allowed to buy themselves back from Xbox and become independent. Employees at several studios have reportedly been told that the situation is still in flux and that they may seek other work. Perhaps selling the company to Microsoft wasn’t such a great idea to begin with?
These are not the only three Xbox studios at risk of closure, but there's still a lot of uncertainty surrounding the company's plans. More to come in the next few days and weeks. Safe to say that the Xbox of July will look drastically different than the Xbox of June.
— Jason Schreier (@jasonschreier.bsky.social) 2026-06-15T20:34:19.841Z
Senua was announced last week, now Ninja Theory reportedly faces closure
Ninja Theory, the Cambridge studio behind Hellblade, is being closed down. Staff were reportedly told about the decision on Monday, although the studio is still hoping to find a buyer. Microsoft has not publicly commented on the reports.
Senua (2027), Source: Ninja Theory
The timing is unusual because Xbox was showing a new game from Ninja Theory during its Xbox Games Showcase just last week. The studio announced Senua, a new title based on the Hellblade character. Its future is now unclear if the studio is sold or closed. Who in their right mind thought announcing the new game for 2027 was a good idea if studio closure was even considered?
Matt Booty praised Double Fine and Compulsion in February, now both may face closure
There is also a clear contrast with comments made earlier this year by Xbox chief content officer Matt Booty. In February, Booty told Windows Central that Xbox was built around a portfolio ranging from smaller games to large franchises. He specifically referenced Double Fine’s Keeper and Compulsion’s South of Midnight, saying Xbox could not lose places “ where little sparks can grow into something big.”
Compulsion Games is the studio behind South of Midnight, which launched last year. Double Fine is known for Psychonauts and recently released Keeper and Kiln. Bloomberg reports that all three studios made award-winning games, but not necessarily major commercial hits.
South of Midnight (2025), Source: Compulsion Games
The reports follow Microsoft’s recent Xbox reset memo from Asha Sharma and Matt Booty . Microsoft said Xbox had overextended its studio system and needed to reassess investment priorities for the next five years. The company also pointed to rising component costs, weaker margins and a need for new hardware partnerships.
Source: Bloomberg , The Verge , windowscentral
