According to these two articles, its a bit of both.

After Shadow of War, Monolith wanted to make a brand new IP with a revamped nemesis system. They didnt want to make a new LotR game and thought they earned enough trust to do so. However, the head of WB Games was not interested in a new IP. Monolith was working on this new IP until 2021 but was shut down with WB Games cancelling the project which resulted in Monolith's entire leadership leaving to form Cliffhanger Games under EA.
https://www.tweaktown.com/news/103578/full-backstory-revealed-on-why-wb-games-axed-monolith-productions/index.html

Current Monolith was then tasked with making a Wonder Woman game despite having a studio with no leadership. Monolith also needed to restart development on Wonder Woman since their first iteration where Wonder Woman can become allies with enemies through the nemesis system didnt work. However, by this time, WB Games had alot of flops like Suicide Squad (-$200M), Multiversus and Quidditch Champions (-$100M). A new head came to WB Games and started cutting studios to minimize losses and reframe their strategy to again focus on their notable franchises. Monolith wasnt producing so they were cut as a result.

Good news from this is Rocksteady is likely going to be strongly encouraged to make another Batman game but single player.

Thanks for the clarification.

Well, there goes my hopes of a Shogo remake. Seriously, that game needs a full remake, Nightdivin' it won't be enough.


Other than that, I enjoyed most of their games that I played over the years, so it's a terrible loss. They were really good.