Arkane Lyon Faces Closure Amid Xbox Restructuring
- Arkane Lyon has until November to find a buyer or face closure, risking 217 jobs.
- A recent report revealed Xbox informed the studio of its potential closure on July 16.
- Negotiations for employee redeployment are reportedly going poorly, with several takeover options being explored.
Arkane Lyon, the acclaimed studio known for titles like Dishonored and Deathloop, is reportedly under severe pressure as it must secure a buyer by November to avoid shutdown following significant layoffs announced by Xbox CEO Asha Sharma earlier this year. Microsoft’s restructuring plan is set to eliminate around 3,200 jobs, impacting various first-party studios.
The situation for Arkane Lyon has grown increasingly dire, especially after the layoffs were confirmed in July, coinciding with Xbox’s ambitious overhaul. While studios like Double Fine, Undead Labs, and Compulsion Games were granted the chance to operate independently, Arkane’s future remains uncertain after the acquisition of ZeniMax by Microsoft in 2021.
A report from French publication Le Monde indicates that Microsoft informed the studio on July 16 that it could face closure. Under French law, any company with more than 1,000 employees must spend three months looking for a buyer before proceeding with a closure. This process began this summer, with a deadline to find a buyer set for November 13.
Should Arkane Lyon close, approximately 217 employees could lose their jobs. Union representatives have indicated that discussions regarding redundancy are not progressing well, and there are ongoing efforts to redeploy Arkane employees to other Microsoft divisions. There are reports of exploring several potential takeover options.
While Microsoft has not officially confirmed or denied the impending closure of Arkane, they stated to Le Monde that they are “exploring various options for Arkane as part of the ongoing French consultation process” and ensuring that the Social and Economic Committee and employees remain informed. Internal documents mentioned that the cessation of operations could begin at the end of 2026 and extend into early 2027.
The fate of Arkane Lyon’s upcoming project, Marvel’s Blade, remains clouded with uncertainty. In July, Xbox maintained that no first-party announced games would be canceled as a result of the cuts, suggesting Blade’s status was secure. However, earlier speculations about the game being over-budget surfaced, indicating a targeted release in 2027 after a delay.
As the company navigates these turbulent times, Sharma mentioned that Xbox has “started to return to growth.” Nevertheless, reports indicate that three additional rounds of layoffs may still be on the horizon, potentially commencing before the end of October.
News Courtesy of Eurogamer
