As part of a restructuring for the previously 250 person team. The report comes via Kotaku which cites anonymous sources for the revelation. Which might be due to the somewhat lukewarm reception that the Dead Rising 4 received. Word is that the studio is still working on the next entry in the series.
But as part of the cuts an unannounced game, said to be set in alternate timeline has been cancelled. As has the scope of the Dead Rising 5. Not that it's a series that has really changed all that much since its debut.