Arkane Lyon could be closed on November 13 if no buyer is found, Le Monde reported, with the buyer-search window required under France’s Florange Law nearly run out. The studio’s 217 employees are three weeks from that deadline, and the search began in mid-July.
Microsoft informed the Lyon office, the French studio behind Dishonored and DEATHLOOP, of its divestment decision on July 16, 2026. That came weeks after Xbox CEO Asha Sharma, new in the job, said Compulsion Games, Double Fine Productions, Ninja Theory and Undead Labs would be closed or spun off, a restructuring that cut more than 1,600 jobs across Microsoft’s gaming business. Ninja Theory shut down and the other three went independent. Arkane Austin, the studio’s Texas branch, was closed in 2024 after the launch of Redfall.
Union says the talks are going badly
A union representative told Le Monde that negotiations on the studio’s redundancy plan are going badly, and said Microsoft wants to shed Arkane although the studio is healthy, as a way to cut spending and lift the returns on its short-term investments. The current round of talks runs until October 30, and the union has not ruled out taking Microsoft to court. It is also pushing for affected staff to be re-employed at other studios within Xbox.
An internal document seen by Le Monde said that if no rescue is found, the company would wind down its activities starting late 2026, running into the opening months of 2027.
Microsoft, for its part, said it continues to explore options for Arkane as part of the French consultation process.
“We are keeping the works council and employees informed and are actively seeking a partner to support the next phase of development and enable the commercialization of the project.”
The company did not commit to keeping the studio open. Marvel’s Blade, the licensed game Arkane Lyon has been developing since its announcement in December 2023, remains in development there; it has never shown gameplay footage, and how much work remains is unclear.
Same day, a reported $800 million asking price
A separate report published the same day by Puck’s Matthew Belloni said Netflix offered $500 million for a seven-year exclusive license to Xbox’s biggest characters for film and TV adaptations, and that Xbox under Sharma countered at $800 million before the deal fell through. Neither company confirmed the figures, Netflix declined to comment, and Xbox said in a statement that it has received record-breaking interest in its IP while calling Netflix a valued partner, citing the forthcoming Minecraft and Diablo animated series together.
