GW rarely writes them out of the setting.
With Squats, the poster-boy example (at least until Age of Sigmar hit) they just didn't post any more about them. There was no fanfare, no lore, they just stopped making and selling them during an edition.
And that's generally how they do it. They don't make noise. They just remove. The multiple messes of armies in AoS (from removed to fragmented) didn't really get much lore behind "why" they never appeared, they just vanished as products.
This "generally" works because before being removed the force is normally "run down". Less investment, less attention all building into less active customers etc... So by the time the plug is pulled the outcry is on the smaller side and people have "seen the writing on the walls for ages".
A lot of the time they don't vanish all in one go and might just vanish steadily, old sculpts being retired and not replaced.
But all in all GW rarely closes the door with "and then the faction died". They just stop mentioning them and stop producing for them.
And this works because when/if GW brings them back they can just, bring them back. Squats, Genestealer Cults, heck Sisters of Battle were near enough retired in all but name based on how long they'd gone without any new lore. GW brings them back with all the fanfare and everyone is happy again.
Kroot are an example of one force that GW could quietly retire bit by bit (they've lost their Forgeworld Models) and then just removed. Or they could be slow building to a big release (we've seen a few character Kroot )
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