Microsoft Extends Arkane Lyon Search as Blade Development Continues
WHO:
GamesIndustry.biz - A Printemps Écologique union representative said the redundancy plan should account for the video game market, where prospects for returning to work are “extremely limited.”
IGN - Todd Howard said he had recently seen work on Marvel’s Blade and that Arkane Lyon was doing “a really, really great job.” He said he could not disclose when more would be shown.
GamesIndustry.biz - Microsoft is seeking a buyer or partner for Arkane Lyon, the studio developing Marvel’s Blade.
IGN - Arkane Lyon has 217 employees whose jobs are at risk unless a buyer is found.
IGN - New Xbox CEO Asha Sharma announced plans concerning Compulsion Games, Double Fine Productions, Ninja Theory, and Undead Labs; IGN reported Ninja Theory was closed while the other studios went independent.
IGN - Bloomberg journalist Jason Schreier said multiple options were being explored to save Arkane Lyon and that he would be surprised if it shut down.
GamesIndustry.biz - A Printemps Écologique union representative said negotiations over the redundancy plan were going badly and criticized Microsoft’s proposed divestiture.
WHAT:
GamesIndustry.biz - The union representative said Arkane Lyon’s potential divestiture contradicted what employees had been told in the Works Council for years about Microsoft’s financial situation.
IGN - Marvel’s Blade was announced in December 2023.
GamesIndustry.biz - Microsoft extended the consultation period to find a buyer for Arkane Lyon by one month while development of Marvel’s Blade continues.
IGN - Microsoft said it was exploring options, including finding a partner to support Arkane Lyon through the remaining development work on Blade.
GamesIndustry.biz - Microsoft said it remained committed to keeping the Works Council informed; it told IGN it was “actively seeking a partner to support the next phase of development and enable the commercialisation of the project.”
IGN - More than 1,600 jobs were cut across Microsoft’s gaming business as part of layoffs; the article said further cuts had followed and more were expected.
IGN - The union is pushing for affected employees to be rehired at other Xbox studios if Arkane Lyon cannot be saved. The representative said the union had not ruled out taking Microsoft to court.
IGN - Marvel’s Blade was announced with a reveal trailer; IGN reported it had not seen further material since.
WHERE:
GamesIndustry.biz - Arkane Lyon is in France; the consultation involves the studio’s Works Council.
WHEN:
IGN - Howard said he had seen Blade-related work on May 21.
GamesIndustry.biz - The consultation period had originally been scheduled to conclude on November 13; Microsoft extended it by one month.
IGN - Microsoft informed the studio of its decision on July 16.
GamesIndustry.biz - An internal report cited by Le Monde said a project to cease the company’s activities was scheduled to begin at the end of 2026 and continue into the first quarter of 2027.
IGN - Marvel’s Blade was reportedly on track for a reveal early next year and release in the fourth quarter of 2027.
WHY:
GamesIndustry.biz - The union representative alleged Microsoft sought to divest Arkane to save money and improve the profitability of short-term investments, despite the studio doing well.
IGN - Schreier said closing a French game studio would be expensive because labor laws require an extended severance period.
HOW:
GamesIndustry.biz - Arkane Studios’ Social and Economic Committee has been consulting with Microsoft as part of the French consultation process.
IGN - Microsoft is exploring a sale or partnership; Schreier said multiple possible paths to preserve the studio were under discussion.
(UPDATED October 26, 2026 23:11 UTC)
Microsoft is seeking a buyer or partner for Arkane Lyon in France, putting 217 jobs at risk, while development of Marvel’s Blade continues and the company has extended the consultation period by a month. A union representative said negotiations were going badly, criticized the proposed divestiture, and urged Microsoft to rehire affected staff at other Xbox studios if the studio cannot be saved; the union has not ruled out legal action. Microsoft says it is exploring ways to support Arkane Lyon through the next phase of Blade, and Todd Howard praised the studio’s work while saying he could not reveal when more would be shown.
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(UPDATED October 26, 2026 22:12 UTC)
Microsoft is seeking a buyer or partner for Arkane Lyon in France, extending the search by a month as development of Marvel’s Blade continues; 217 employees’ jobs are at risk if no deal is found. The company says it is exploring ways to support the game’s remaining development and eventual release, while the union says negotiations are going badly and is seeking jobs for affected staff at other Xbox studios. The union has also criticized Microsoft’s proposed divestiture and has not ruled out legal action, as Microsoft weighs options to preserve the studio.