Eidos Montreal’s Future Reportedly Tied to Grounded 2 and Fable
A new report from Insider Gaming’s Mike Straw claims Eidos Montreal’s internal outlook could worsen once its work on Grounded 2 and the new Fable wraps, tying the studio’s fate directly to Embracer Group’s ongoing restructuring. The Montreal team has been in support roles on both Xbox projects while dealing with multiple rounds of layoffs and cancelled internal games.
Inside the Article:
According to the report, Eidos Montreal has been providing large-scale support on Grounded 2 and Fable rather than leading its own new IP, with one resume suggesting around 100 developers were contracted to help Playground Games on Fable before that contract ended earlier this year. The studio has already seen senior staff let go and a slate of projects—including a dark fantasy ARPG, a sci-fi stealth game likely tied to Deus Ex, and a modern point-and-click title—quietly cancelled as Embracer trims costs.
Grounded 2 is currently listed for a 2025 release, while Fable is still targeting a broad 2025 window without a firm date, and neither Microsoft nor Embracer has publicly detailed Eidos Montreal’s exact role beyond “support” work. Recent layoffs at the studio, including roughly 75 staff reportedly cut in March 2025, are already linked to contracts ending and internal projects being scrapped, with no clear replacement lead project announced.
How Embracer’s Cuts Put Eidos Montreal in a Tight Spot
The report frames Eidos Montreal as one of several Western teams squeezed by Embracer’s cost-cutting, divestments, and studio closures, with the studio’s current security reportedly tied to how smoothly its Xbox support work concludes. Internally, milestones on Grounded 2 and Fable appear to function as key checkpoints, with more layoffs rumored once those obligations are fully met.
In practice, that’s meant Eidos Montreal shifting from leading big single-player projects like Deus Ex and Guardians of the Galaxy to acting as a large support house on other studios’ games. The cancelled Deus Ex follow-up and other shelved concepts underline how far the studio has moved away from pitching and owning its own slate, even as expectations around Grounded 2 and Fable remain high on the Xbox side.
Neither Embracer, Xbox, nor Eidos Montreal has offered detailed on-the-record comments about the report’s specific claims, and the picture right now is built from layoffs, resumes, and sourcing rather than formal announcements. Still, the pattern of restructuring, contract endings, and project cancellations is concrete enough that players should treat the studio’s current position as fragile rather than speculative.
What This Means for Players and Big AAA Projects
If Eidos Montreal’s future really hinges on how Grounded 2 and Fable land, that could decide whether the studio returns to leading its own single-player games or continues as a support outfit with a smaller headcount. Strong launches and stable post-release support would give Embracer and Xbox more reason to keep the team heavily involved, while weaker outcomes could make further cuts or downsizing more likely behind the scenes.
For players, that uncertainty touches everything from long-term support for Grounded 2 and Fable to the odds of seeing a new, Eidos-led narrative project instead of more contract work. It also fits into a wider pattern of restructuring that’s reshaping familiar franchises and development lineups across the industry, where one or two big-budget releases can quietly decide which studios get to keep pitching ambitious campaigns and which get folded into support roles.
This matters because every major release now carries higher stakes for the teams behind it, not just for sales charts. For more on how publisher shakeups are hitting established studios, check out our coverage in the entertainment section, and for a broader look at Xbox’s first-party strategy and upcoming exclusives, keep an eye on our latest gear and platform coverage.
