Undead Labs, the Seattle-based studio behind the State of Decay series, goes independent following Xbox restructuring and a recent round of Microsoft layoffs. The studio had previously said it was “transitioning out of Xbox,” and now confirms it will no longer operate under the Xbox umbrella.
Several outlets report that the independence announcement is accompanied by job cuts. Eurogamer and Rock Paper Shotgun say Undead Labs lays off “a significant number” of employees as part of the transition. Rock Paper Shotgun adds that the affected staff include “exceptionally talented developers,” while other coverage emphasizes that the studio has “survived” another Xbox layoff round but is still reducing headcount.
Across the reports, the shared focus is on the studio’s shift away from Microsoft and the impact on its workforce. While the outlets differ slightly in phrasing—some highlighting survival of the latest cuts, others stressing the scale of layoffs—they all describe the same sequence: independence from Xbox, then staffing reductions tied to that change. The third State of Decay game is also positioned as a continuing focus for the studio’s future.
