They are probably building a new game all this time. It is a lot of capital to just apply free updates to a game they already sold 10M units on. There is little expectation they will charge for MIstlands so there is little reason to spend full time hours on it. My money is on they are using the capital raised from Valeim's sales to build a new game with similar mechanics to Valheim with its semi-unique procedurally generated world but very unique building system and world building abilities that could easily be applied to many different game ideas.

Or they are just in Bora Bora drinking mai thais