Undead Labs Becomes Independent Studio, Conducts Layoffs

Undead Labs has gone independent from Xbox this week, joining Double Fine and Compulsion Games as studios breaking away from the Xbox umbrella. The transition came as part of a broader Xbox reorganization.

The studio confirmed layoffs in a LinkedIn post, stating: "Unfortunately, today we are also saying goodbye to a significant number of our colleagues. It's difficult to reach this moment knowing that not everyone who helped get us here gets to make the rest of the journey with us."

Undead Labs is now structured as an employee-led studio. Despite years without major announcements, State of Decay 3 remains in active development.

Studio head Philip Holt said in a statement: "Independence brings us closer to our community and lets us focus on what matters most: making the best games we can and earning the continued support of the people who choose to spend their time with us. State of Decay exists because millions of players have made that choice over the years, and we're dedicated to honoring their trust."

The independence move contrasts sharply with other affected studios. Arkane and Ninja Theory are headed toward full closure, with Ninja Theory unable to secure a buyer despite two acquisition attempts.