Undead Labs Cuts Staff After Leaving Xbox Umbrella
The cuts land at a studio that just gained independence from Xbox, and the statement ties the departing staff's work directly to State of Decay 3, which the studio says is still in production.
Reporting from 1 source: Game Spark.
Undead Labs announced layoffs on September 23, 2026, saying it had "said goodbye to many of our teammates." The studio, known for the State of Decay series, recently moved from under the Xbox umbrella to become an independent studio. The statement says State of Decay 3 production continues, and the game remains planned for PC, PS5, and Xbox Series X|S with a day-one Game Pass release.
The statement describes the decision as difficult and notes that many such announcements have come from across the industry. It also addresses the departing staff directly: the results of their work remain part of Undead Labs and part of State of Decay 3.
The reorganization that moved the studio out from under the Xbox umbrella was reported before the layoffs were confirmed. State of Decay 3 is still planned for PC (Steam and Xbox), PS5, and Xbox Series X|S, with a day-one Game Pass release.
Synthesized by Yomimono from the 1 cited source below, including Japanese-language reporting where cited, then editorially reviewed before publishing.