Xbox is shutting down Hellblade creator Ninja Theory

At a glance:

• Xbox is closing Ninja Theory, the studio behind the Hellblade series, with staff reportedly told on a Monday call.
• The move follows warnings from Xbox leaders Asha Sharma and Matt Booty about a reset, an overextended studio system, and rising hardware component costs.
• Microsoft-owned Compulsion Games and Double Fine are reportedly in active spin-off negotiations, while Compulsion's shutdown plans were separately reported by Kotaku.

What happened

Xbox is closing down Ninja Theory, the studio behind the Hellblade series, a source tells The Verge. Staffers were told on a call on Monday about the closure, and the report says they are hoping the studio will find a buyer. Xbox didn’t immediately reply to a request for comment.

The closure is significant because Ninja Theory is one of Xbox’s recognizable studio labels, and its future was just highlighted with Senua, a new Hellblade game, at the Xbox Games Showcase just over a week ago. That reveal makes the shutdown especially abrupt for players tracking the franchise, because Senua was presented as part of Xbox’s slate before this reported restructuring. The report does not say whether Senua is canceled, moved to another studio, or preserved as part of a buyer-led continuation.

The broader Xbox reset

The closure comes as “several” Xbox studios at Microsoft, including Compulsion Games and Double Fine, are in “active negotiations” about spinning off, Bloomberg reports. Kotaku reported earlier on Monday that Microsoft was planning to shut down Compulsion, though an update said studio leadership was in “negotiations” with Microsoft. Those reports suggest the Ninja Theory closure is part of a broader portfolio review rather than an isolated shutdown.

Last week, Xbox CEO Asha Sharma and chief content officer Matt Booty warned of a “reset” at Xbox, laying out several challenges facing Xbox’s business. They said Xbox had “over extended” with its studio system, and that the hardware component crisis is significantly driving up prices. That framing points to cost discipline and portfolio simplification as likely drivers, even as Xbox continues to promote major first-party releases.

What comes next for players and projects

Sharma has made many major decisions since taking over at Xbox in February. Those include locking down Gears of War: E-Day and Clockwork Revolution as Xbox console exclusives in an announcement at the Xbox Games Showcase just over a week ago. During that same event, Microsoft also revealed Senua, tying Ninja Theory to a slate that now looks unsettled.

For fans and employees, the immediate question is whether any of Ninja Theory’s teams or projects can continue under new ownership. The source says staffers are hoping the studio will find a buyer, which could preserve jobs and development continuity if a deal can be reached. Until Xbox comments, the status of the studio’s operations, projects, and announced Hellblade follow-up remains unclear.