This does not mean that the Montreal team has given up on mobile games. However, Naud wanted the study to promote more innovative experiences. If it worked on a family property, it would have to "reinvent in some way" the mechanics of the game.
It is not hard to see why Square Enix would move away from what appeared to be an infallible recipe for success. When a free release like Fortnite provides a deep and polished experience and earns huge profits, it's hard to justify charging money no matter how good the game is. Free games have evolved to the point where they are often as good as paid games, and mobile developers may have no choice but to adapt.