Ninja Theory Begins Layoffs After Two Xbox Spin-Off Deals Fall Through

Ninja Theory, the Cambridge-based studio behind the critically acclaimed Hellblade series, has begun laying off staff following Microsoft's confirmation that two separate deals to spin the studio off from Xbox fell through. Employees began announcing their redundancies on social media on October 5, 2026, painting a bleak picture for a developer that had been widely celebrated for its innovative, small-team approach to triple-A game development. The layoffs appear to be the direct result of a consultation process with Xbox that followed a second wave of broader Microsoft cuts the previous week.

The studio's closure had already been signaled by Xbox, which acknowledged that attempts to divest Ninja Theory to outside buyers failed on two occasions. The recently announced title Senua, which was reportedly designed in part to attract potential investors and buyers, was not enough to secure the studio's future. Developers took to social media to share emotional farewells, with one post capturing the sentiment of many: "Even if I knew how it would end, I would do it again." The redundancy process now underway marks what appears to be the final chapter for a studio that has operated under Microsoft's umbrella since its acquisition in 2018.

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