Ninja Theory Faces Closure as Xbox Deal Collapses
Xbox has announced plans to close Hellblade developer Ninja Theory after two separate agreements for the studio fell through, putting the future of its games in doubt.
What happens when a beloved studio's escape plan falls apart? For Ninja Theory, it might mean closure. On September 22, Xbox's Matt Booty announced that the Hellblade developer is headed for the chopping block after two separate agreements for the studio fell through. "We will now begin consultation with employees on a proposed closure while continuing to explore other paths forward," Booty wrote on the official Xbox website.
If you're a fan of Ninja Theory, you know their pedigree. Founded in March 2000, the studio brought us Heavenly Sword, Enslaved: Odyssey to the West, DmC: Devil May Cry, and Bleeding Edge. But they're best known for the Hellblade series, with Senua's Saga: Hellblade 2 launching in 2024. A third entry was planned for 2027, but that's now up in the air.
This isn't a sudden decision without warning. Back in July 2026, Xbox CEO Asha Sharma said Ninja Theory and Undead Labs had "entered terms to join new ownership with funding." But those deals have now collapsed, leaving the studio in limbo. Booty's language doesn't mean Ninja Theory is closing this second—the "consultation with employees" is likely part of UK law, which requires at least a 30-day consultancy period. During that time, measures to avoid redundancies are discussed while staff get time to find new jobs.
Still, the writing seems to be on the wall. Unless another buyer steps forward, the plan is to shutter the Hellblade developer. It's a tough blow for a studio with such a rich history.
Meanwhile, Xbox continues its massive reset. Activision will develop the next Halo, Playground Games and Turn 10 Studios have merged, and Obsidian will operate under Bethesda Game Studios. The aftermath of this latest layoff will see Microsoft cut at least 268 staff, after already laying off 1,600 employees in July. It's yet another sad day in the games industry.
What do you think about Ninja Theory's fate? Will you be picking up their games while you still can? Let us know in the comments.
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