Obsidian Entertainment is shifting focus from a canceled Avowed sequel to a new Fallout project. The change follows recent layoffs at the studio and a new strategy under Xbox leadership.
Obsidian, known for Avowed and The Outer Worlds, has canceled plans for an Avowed sequel. The studio is now working on a new Fallout game led by design director Josh Sawyer.
A WARN Act notice shows 52 employees were laid off from the Irvine, California office. This represents about a quarter of the studio's headcount amid broader Xbox cuts.
The Avowed sequel had been scheduled for a reveal within the next year but did not align with new Xbox CEO Asha Sharma's priorities. Bethesda will remain involved in the Fallout project while continuing work on The Elder Scrolls VI.
The move comes as the Fallout TV series remains popular on Amazon, though Fallout 5 has no announced timeline.
