Obsidian Entertainment to develop new Fallout game as Microsoft cancels Avowed sequel

Microsoft's major Xbox restructuring, which includes 3,200 layoffs and studio closures, is reshaping plans at Obsidian Entertainment. The studio, known for Grounded and The Outer Worlds, has been directed to begin development on a new Fallout title. As part of the shift, Obsidian has cancelled multiple in-development projects, including a sequel to its 2024 RPG Avowed. Studio design director Josh Sawyer will lead the new Fallout project. The last mainline Fallout game, Fallout 76, was released in 2018, despite the franchise gaining renewed popularity through its hit TV adaptation.
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