REPORT: Obsidian Greenlit By Xbox To Work On New Fallout, While Keeping Hopes For Avowed 2 Alive

Rumors indicated a sequel to Avowed being cancelled were false

"ColonelFancy" Mike Lind

7/11/20262 min read

With the major shake-ups that have swept through Xbox, which involved slashing 3,200 jobs, and the exodus of four game studios. Amidst that, development of awaited projects will see a hit in production, especially from Obsidian. As a part of the July job culling, at least 25% of the team behind The Outer Worlds saw their jobs rendered as redundant.

Initial reporting indicated that plans for a new Fallout game with Obsidian at the helm are greenlit, while a sequel to their 2025 action RPG, Avowed, were scrapped. The California-based studio has a history with the series, as they produced 2010's Fallout: New Vegas, one of the most beloved entries. With a leaner staff, what does that mean for Avowed? According to Wccftech.com, former co-founder Chris Avellone states on social media that in the midst of Xbox's big reset, some of Obsidian's projects are in the midst of being "re-evaluated".

It seems Grounded is still going (mostly out-sourced in Eidos Montreal anyway, so no surprise), Outer Worlds 2 expansions still planned for now (1st one is Sept), and uh, despite reports, Avowed 2 is STILL being worked on (for now) in the hopes of being “re-pitched” (whatever that means). All other projects at the studio, including the rumored Shadowrun game John Gonzalez was on, were put on pause.

Edit: No mention of any Pillars of Eternity games, so if Avowed 2 doesn't get a buyer/approval, looks like may be some time (or never) before another Pillars game or PoE3.

In response to a reply that heard the stated rumor of an Avowed 2 being canned effective immediately, Chris stated that it is still being worked on (at least as of this writing).

They're still working on it as of today, according to folks at Obsidian. They're trying to "re-pitch" it when the dust settles, probably because so much work was already put into it.

It may be the most prudent course of action for Obsidian to take for the time being. Launching in 2025, Avowed was met with generally positive praise. It became one of the circumstances of Game Pass' model doing little to nothing for the sluggish sales of the action RPG, nor did it lead to more subscriptions to the service. If the Pillars of Eternity line of games come to an end, would Avowed (which takes place in the same universe) carry the mantle for that lore? Perhaps that's looking far ahead. In the wake of Xbox's current plans, almost anything could be up in the regarding the fate on not only software, but studios.

SOURCE: Wccftech.com, Twitter/X

Socials

Marketing/ PR

Verlane@gamefixshow.com

© 2025. All rights reserved.