Watch: Arkane Lyon has 3 weeks to find a buyer or face closure. The Dishonored and DEATHLOOP studio could close on November 13 if Microsoft finds no buyer.
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Microsoft informed Arkane Lyon of its divestment decision on July 16, 2026, and under France’s 2014 Florange Law the studio must be given at least three months to find a buyer before it can be closed. That search window expires on November 13, 2026, leaving the studio’s 217 employees in limbo. The workers learned of the decision the day before Xbox CEO Asha Sharma announced closure and spinoff plans for Ninja Theory, Compulsion Games, Double Fine Productions, and Undead Labs as part of a July restructuring that hit more than 1600 gaming jobs.
The workers’ union says negotiations on the redundancy plan are going badly, and it is pushing for re-employment at other Xbox studios while not ruling out taking Microsoft to court. Microsoft says it is actively seeking a partner to support the next phase of development and enable the commercialization of the project, but it has given no timetable for a deal. An internal document points to a complete end of activities from the end of 2026 into the first quarter of 2027 if closure proceeds.
At stake is one of the most respected studios in the industry, the team behind Dishonored, Dishonored 2, and DEATHLOOP, and the in-development Marvel’s Blade, which could be left unfinished. Arkane Austin, the sister studio behind Redfall, was already shut down in 2024, and fans hope Lyon does not follow it.
