Which Xbox studios are being spun off or sold?

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Microsoft is Spinoff or Selling Four Xbox Studios as Part of Restructuring

Microsoft is undertaking a significant restructuring of its Xbox gaming division, which includes spinning off or selling four studios. This move is part of a broader cost-cutting effort that will result in approximately 4,800 job eliminations across the company, with a substantial portion affecting the gaming sector. The specific studios involved in this transition are Compulsion Games, Ninja Theory, Undead Labs, and Arkane's operations in France.
Compulsion Games and Ninja Theory Becoming Independent or Changing Ownership

Compulsion Games, recognized for its work on South of Midnight and its association with Double Fine Productions, is set to become an independent entity. This independence will allow the studio to retain its intellectual property and existing game catalogs. Separately, Ninja Theory, the developer behind the Hellblade series, has also entered into terms that will see it move to new ownership, with the expectation that it will continue its current projects under this new arrangement.
Undead Labs and Arkane Studios Face Restructuring

Undead Labs, the studio responsible for the State of Decay franchise, is also entering into terms to be acquired by new owners, with provisions to continue its ongoing game development. In France, the management of Arkane Studios has initiated a mandatory consultation process with its Works Council. This consultation is to explore "potential strategic options" for the studio's operations, which could potentially lead to further studio closures or a sale of the entity.
Broader Context of Xbox Division's Financial Performance

These studio transitions occur within the context of a challenging financial period for the Xbox division. The division's profit margins have been reported as significantly lower than those of its competitors, prompting a strategic re-evaluation. A key bet on the Game Pass subscription service to drive growth faced setbacks after a price increase led to subscriber losses, necessitating a reversal of that pricing strategy. The aim is to return the division to growth by fiscal year 2027.

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Which Xbox studios are being spun off or sold?

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