Ninja Theory Faces Potential Closure After Buyout Deals Fall Through

Microsoft has entered a consultation process on the possible closure of Ninja Theory, the UK studio behind the Hellblade series, after failing to find a buyer. Xbox chief creative officer Matt Booty confirmed in an internal memo that two separate agreements to sell the studio fell through. Microsoft says it is still exploring alternative paths for the team.

How it got here

Ninja Theory was one of several studios Microsoft put up for sale earlier this year as part of a wider restructuring of Xbox. Another, State of Decay developer Undead Labs, has since become independent and employee-owned after its own sale to Gears Tactics co-developer Splash Damage collapsed. Ninja Theory has not found a similar route so far.

In the UK, a consultation is a formal process that must take place before large-scale redundancies. It gives staff and their representatives a chance to discuss the proposal and alternatives, so it does not mean the studio has already closed. It does mean closure is now a real possibility.

Part of wider Xbox cuts

The announcement came alongside a broader round of cuts across the Xbox organization, including 268 layoffs and the restructuring of several well-known studios. The timing drew sharp criticism from industry veterans. Ninja Theory had revealed a third game in the Senua series only weeks before Microsoft signaled its intention to sell the studio, a move widely seen as an effort to attract buyers.

A studio with a long history

Ninja Theory was founded in Cambridge, England, in 2000 as Just Add Monsters Limited. Its games include the PlayStation 3 action title Heavenly Sword, Enslaved: Odyssey to the West, the reimagined DmC: Devil May Cry and the Hellblade series. Hellblade: Senua’s Sacrifice in 2017 won wide praise for its depiction of psychosis and its performance capture, and it helped lead to Microsoft’s acquisition of the studio in 2018. Senua’s Saga: Hellblade II followed on Xbox Series X|S and PC in 2024.

Former producer Chris Rowe highlighted the depth of talent still at the studio, noting that many developers who were there more than a decade ago remain on the team. “The Senua series was fantastic at pushing the boundaries of visuals and performance capture,” Rowe said. Current and former staff have used LinkedIn and other platforms to share their disappointment and frustration.

Why it matters

For players, the most immediate question is what happens to the third Senua game. Microsoft has not said whether the project will continue under any new arrangement, so its future is uncertain until the consultation ends.

More broadly, Ninja Theory’s situation shows how Xbox’s restructuring is reshaping its first-party lineup. Studios bought during Microsoft’s expansion years are now being sold, spun out or closed, and the outcome for Ninja Theory will be one of the clearest signals of how far that reset goes.