Philip Holt, head of Undead Labs, stated that following the studio's independence and layoffs, the development plan for State of Decay 3 needs adjustment. However, the project has entered the Alpha phase, and he believes there is no need for significant reductions in development scope at this time.
Holt explained that the studio had previously been a candidate for acquisition by new owners, but the deal fell through, leading to a management buyout and independent operation. The team has secured the necessary funding to complete the game through a publishing agreement; as an independent company, the studio must still adjust its cost structure to establish a sustainable operational model supported by post-launch revenue. He did not disclose the number of layoffs.
Regarding development changes resulting from the layoffs, Holt indicated that the departure of multiple employees necessitates adjustments to the original plans. Virtuos, Wushu, and Blind Squirrel are also collaborating on the development of State of Decay 3.
State of Decay 3 was announced in 2020. Holt said that the production team was small at the time, and full-scale development only truly ramped up around 2022–2023; the early trailer release was intended to show players the direction of development. The team remains committed to making the best game possible, and the plan to launch day-one on Xbox Game Pass remains unchanged. The game is scheduled to release on PC, PS5, and Xbox Series X|S, though an exact release date has not yet been announced.