Dead Island 2 has been through development hell. It was first revealed at E3 2014 and slapped with a Spring 2015 release, but was delayed until 2016 after the developers "didn't reach the goal" they had set out to achieve.
After the delay, the developer (Yager) and publisher (Deep Silver) parted ways, then Yager shut down, which lead developer Sumo Digital to pick up the work on Dead Island 2. As of November 2016, the game was reportedly making "fantastic progress" at Sumo Digital.
Lately, there hasn't been much news on the anticipated game, but it appears to still be alive at Sumo. A job listing (via NeoGaf) at Sumo Digital lists Dead Island 2 as one of the games they are working on, along with Crackdown 3:
We are also incredibly proud to be working on the highly anticipated Crackdown 3 (Xbox One) and Dead Island 2 (multi-platform) plus several other exciting but yet unannounced projects.
This blurb can be found across a number of the developer's job listings.
There's no telling when the game will release and there's no knowing whether Sumo scrapped all of Yager's work and started over or if they built off of what was already in development.
