Xbox suspends development of Contraband from Just Cause creators

Xbox is once again bucking the industry trend by canceling another project. This time, the company has canceled Contraband, a co-op game developed by Avalanche Studios, known for the Just Cause series. The studio's official website has released a statement saying that active development, which lasted four years, has come to a halt.

"Over the past several years, Avalanche Studios Group and Xbox Game Studios Publishing have collaborated on Contraband. Active development has now stopped while we evaluate the project's future. We're thankful for the excitement we've seen from the community since we announced and will give an update on what's next as soon as we can."

Contraband was first announced during E3 2021. At that time, a small teaser was shown for the cooperative game, which the studio's website described as a "smugglers' paradise," set in the fictional world of Bayan in the 1970s.

According to Avalanche Studios, the project is not completely closed, but rather suspended. The decision was probably initiated by Xbox, which financed the game and was supposed to be its publisher. If the studio manages to find a new partner or source of funding, development may resume.

As for Xbox, this isn't the first project the company has canceled this year. Previously, development on Blizzard's Warcraft Rumble mobile game, Everwild, Perfect Dark, and an unannounced MMO from the creators of Elder Scrolls Online were all canceled. The online game Blackbird was also canceled.

Amidst the numerous project cancellations, Microsoft has also made massive cuts in its gaming divisions. In particular, on July 2, 2025, the company announced the layoff of 9,000 employees across the corporation, including the Xbox division and internal studios. Prior to that, in May, another 7,000 were laid off.