It was real touch-and-go with Lords of the Fallen 2 for a long time. The first game was developed by Deck13, but that studio moved onto making The Surge for Focus Home Interactive. So, publisher CI Games tabbed Defiant Studios for the sequel. That didn't go well, as CI Games ripped the game away from Defiant after "inadequate execution" of a vertical slice of gameplay; Defiant went on to say it "categorically [disagreed] with the portrayal."
Sounds like enough to kill a project, right? Lords of the Fallen 2 might have fell down, but it got back up and dusted itself off.
CI Games has opened a new two-city studio that will work on Lords of the Fallen 2. Named Hexworks, this team is located in Barcelona and Bucharest. Hexworks was created with the explicit purpose of focusing on fantasy action RPGs.
As for Lords of the Fallen 2, a few things have changed. Hexworks is appealing even more to the Souls-like sensibilities, saying that the sequel will be even more challenging than the original. There's a tonal shift too, as the developer describes this game as leaning more into dark fantasy rather than power fantasy. Lastly (and this may seem obvious now), Lords of the Fallen 2 is slated for PC and next-gen consoles; if everything had gone to plan all along, it probably would've been a current-gen game that had released by now.