According fut coins to a source speaking to Shacknews, the studio stopped working on Prey 2 back in fifautc November in order to try and secure a better contract.This lead to numerous staff having to be laid off, with the intention for them to be re-hired once a better deal had been agreed with Bethesda - talks with Bethesda reportedly stopped in March this year.
According to Bethesda the game's delay is due to the fact that game development has not progressed satisfactorily this past year, and the game does not currently meet our quality standards.