State of Decay 3 may not launch day one on Xbox Game Pass as originally planned, following Microsoft's sale of its developer, Undead Labs. Microsoft laid off 3200 employees across its Xbox division, including the studio responsible for the zombie survival franchise. While Microsoft has found a buyer for Undead Labs and committed to continuing funding the game until its release, the agreement reportedly absolves the studio from any Xbox-controlled terms. This means the new owner of Undead Labs will not be obligated to launch State of Decay 3 into Game Pass.
The identity of Undead Labs' new owner is expected to be revealed later this summer, according to a report by Game File. Previously, all trailers and announcements for State of Decay 3, including a gameplay reveal during Xbox's June showcase, stated that the game would be available on Game Pass on day one as is standard for first-party Xbox titles. While a future Game Pass launch is still possible, it would require a new deal to be negotiated between Xbox and the studio's new ownership.
State of Decay 3 has been in development since its announcement in 2020, with full development commencing later. The game is slated for release in 2027 on PC, PlayStation 5, and Xbox Series X/S.