Undead Labs Goes Indie and Cuts Staff to Keep State of Decay 3 Alive

The studio bought itself from Microsoft to remain independent. This move required laying off a significant number of developers.
Key points
- Undead Labs has completed its separation from Xbox and is now an employee-owned studio.
- The studio laid off a significant number of developers to achieve this independent status.
- State of Decay 3 remains in development with a planned launch in 2027.
Undead Labs has officially separated from Xbox. The studio is now an independent, employee-owned company. This decision ensures the survival of their latest project.
The team confirmed that State of Decay 3 remains under active development. The game is currently in its alpha testing phase. It is on track to reach closed beta by the end of this year.
Staff cuts accompany independence
Achieving independence required difficult personnel decisions. The studio laid off a significant number of employees. They did not disclose the exact number of people affected.
The company expressed regret over the situation. They described the dismissed colleagues as people they would hire again instantly. This highlights the harsh reality of the current industry climate.
Game release plans stay intact
Despite the changes, the launch timeline remains unchanged. The game is scheduled to launch in 2027. It will be available on multiple platforms.
Players can expect it on Xbox and Game Pass. It will also come to PlayStation 5 and PC. Massively Overpowered reported that the development is proceeding as planned.
Employee ownership changes the dynamic
The studio is now owned by its own staff. This structure gives developers a direct stake in the company. It offers a different level of control than working for a giant corporation.
However, this path comes with financial risks. The team had to cut staff to afford this freedom. It remains to be seen if this model will sustain the project long-term.






