You know something is seriously wrong with the games industry when selling 1 million copies is considered a "failure" and warrants shutting down the entire studio. (I know this is Activision we're talking about here - if it doesn't get CoD levels of sales or can't be milked on an annual basis, then axe it - but still.)
1 million copies should not sink a franchise. 1 million copies is a pretty strong seller.
So I'm guessing this is another case like Kingdoms of Amalur? Game sold fine, but still lost money due to terrible budgeting? Was it all the money they spent on ridiculous marketing?