The show was purportedly cancelled after 52 episodes because at that time, many independent production companies were being taken over by larger networks, who wanted to produce their own content. "Exosquad" was eventually moved to poor time slots, such as 4 a.m., until the ratings were no longer sufficient to sustain it. The final episode detailed the post-war political and social climate prevalent in the "Exosquad" universe, and closed with J.T. Marsh engaging a group of alien space vessels, whose exact nature was to be explained in the third season or a feature movie. Michael Edens later remarked that the staff originally planned the aliens to be insectoid and that the Pirates' dark matter, Dr. Ketzer's experiments, and the unactivated clone of Phaeton would have played a great role in fighting them. The idea of a movie based on "Exosquad" was being promoted by executive producer Jeff Segal, and it was also planned to expand the fictional universe with a spin-off series, then codenamed "Exo-Pirates". Both initiatives were scrapped with the cancellation of the third season.