Xbox wants to cancel Marvel's Blade and sell off Arkane Studios, report says

Arkane Studios — the team behind Dishonored — is reportedly on Xbox's chopping block, with Microsoft looking to cancel Marvel's Blade and sell the studio outright. The report comes from The Verge, published June 30.

According to The Verge, Blade slipped its internal release date from this year to next and ran over budget, prompting Xbox to consider cancelling the project entirely. With the game gone, Microsoft is exploring a sale of Arkane rather than keeping it in-house. Arkane joins a growing list of Xbox studios in a precarious position — Double Fine, Ninja Theory, and Compulsion Games have all been named in prior reports as studios whose leadership is actively negotiating to keep their teams together, whether through spinoffs, sales, or other arrangements.

Arkane is one of the more storied studios under the Xbox umbrella. Founded in Lyon and with a second studio in Austin, the team built its reputation on the Dishonored series and Prey before shifting to the live-service shooter Redfall, which launched to a rough reception in 2023. Marvel's Blade was announced at The Game Awards 2023 as a single-player action game, and represented something of a return to Arkane's roots after Redfall's struggles. A cancellation would mark a significant blow to that recovery arc.

No official statement from Microsoft or Arkane has been issued at the time of writing. The broader Xbox restructuring — which is expected to result in mass layoffs and multiple studio closures or spinoffs — has not yet been formally announced, but reporting from multiple outlets suggests it is imminent.