Originally Posted by Sven_
Yeah, they eventually broke even. (…)

However, PoE2 and Tyranny were considered a sales disappointment upon release. Which is one of the reasons why they didn't immediately go on to develop a PoE3, even though in the build-up there were already talks about that
I have seen this narrative going around, but I still think there are a lot of assumptions here.

First thing first. PoE2 broke even some time after release (a year?), and according to JS the game became quite profitable (Source) The reason Josh Sawyer always gave on not going straight to PoE3 was always burnout - they have been working non-stop on PoEs for 10 years, they want to do something else. Lack of initial enthusiasm for PoE2 only reinforced the decision as the was no financial incentive to immediately put out another title. As the article you mentioned they also weren’t sure why Deadfire didn’t catch the fire like the original did. They were well aware of things that Deadfire didn’t do so well, but those were hard to point to as sole reason. Add to that, that at least for Josh PoEs weren’t exactly a passion project, and it’s no wonder Obsidian used new found freedom to pursue other projects. PoE2 initial poor sales were certainly a factor, but I don’t believe it resulted in sharp change in IP development, as some claim.

I do wonder if they still have those doubts, or if continuing sale and reception of Deadfire alleviated their concerns as far as PoE3 viability is concerned.

People assume that ending of PoE2 is a story hook for PoE3 and Avowed is a result of PoE2 poor initial sales, but I don’t believe that. Avowed has been something Feargus U. wanted to do for a long time, and Microsoft acquisition might have provided an opportunity to do that. My suspicion that PoE2 was a set up for Avowed rather than PoE3 seems more and more likely with each destabilise revealed. I think Avowed will tell us more about how Obsidian perceives rhe IP - if they will still nurture what made Eora unique, or if they will try to move it in another direction.