Just didn’t perform as well as should have
A sequel for Enslaved: Odyssey to the West has apparently been scrapped for the time being. Developer Ninja Theory claims that the title’s ‘underperformance’ is the reason for the decision. While the studio admits that it should have done better, the lack of sales has caused the studio not to expand or to add a second development team.
According to reports, the title only sold 730,000 as of last spring; but the title did receive pretty good reviews and those that played it seemed to enjoy it for the most part, which was a good sign. So, instead of working on the sequel to Enslaved: Odyssey to the West, the studio is working on a new reboot to the Devil May Cry franchise which is planned for release next year for both the Xbox 360 and PlayStation 3.
While no one is saying that a sequel to Enslaved: Odyssey to the West will never happen in the future, right now it seems pretty unlikely.