Key information
State of Decay 3 developer Undead Labs has become an independent, employee-owned studio after leaving the Xbox Game Studios portfolio. The team initially revealed State of Decay 3 in 2020 partly to ensure the project and studio remained visible to Microsoft during a major acquisition wave.
A small team began working on the title in 2020, and development accelerated a few years later. While under the Xbox umbrella for eight years, the studio did not release a new game, though it delivered thirty-eight updates for State of Decay 2.
Studio head Philip Holt stated that no dramatic behind-the-scenes issues caused the departure from Xbox. Instead, management proposed a buyout during an accelerated divestiture period because the studio was close to generating revenue and required a manageable amount of capital to finish the project.
Microsoft accepted the management-led acquisition offer. However, following departures from Microsoft's gaming division during the twenty twenty-six Xbox reset, Undead Labs experienced staff cuts as it entered this new independent era.
