Microsoft’s Xbox division is entering a new phase of its long‑running restructuring. In a recent announcement, the company confirmed it will cut an additional 268 jobs, adding to a wave of layoffs that have already reduced staff at the studio that produces the Halo franchise. At the same time, Xbox disclosed that Activision, the publisher behind the Call of Duty series, will assume responsibility for developing any future Halo titles.
What the layoffs mean for Halo and its studio
The cuts are part of what Xbox chief executive Asha Sharma described in July as the "most significant restructure in Xbox history." According to the source, the company is now "three quarters of the way through its planned restructure." While Halo Studios, which released Halo: Campaign Evolved in July, will continue to support the existing game’s community, it will no longer focus on new releases. Instead, the development of new Halo entries will be handed over to Activision.
Activision’s new remit
Rob Kostich, president of Activision, said the company has begun "assembling a purpose‑built team, unique in capability and talent, ready and excited to deliver this next chapter with the community." The move is presented as an effort to "make the greatest Halo game ever, worthy of its universe and legacy, while staying true to what made players love it in the first place." In addition to Halo, Activision’s remit will expand to manage other Xbox studios, including World’s Edge (the home of the Age of Empires franchise), Rare (known for Sea of Thieves), and the Bethesda‑Obsidian partnership that handles titles such as Fallout New Vegas.
Impact on other Xbox studios
The restructuring is not limited to Halo. The BBC‑cited statements from Xbox’s chief content officer Matt Booty indicate that attempts to sell the Cambridge‑based studio Ninja Theory have failed, with two separate agreements falling through. Ninja Theory will now enter a consultation period over a proposed closure, although "potential buyout talks are continuing." Of the four other affected companies, three have returned to management, while consultation for Arcane remains "under way," according to Booty.
Industry reaction
Commentators have framed the shift as both dramatic and strategic. Jez Corden of Windows Central called the change a "dramatic move," while gaming analyst Christopher Dring noted that Halo was once Xbox’s "crown jewel" but has not held that status for more than a decade. Dring added that bringing Halo under Activision’s leadership "makes sense," provided the unique identity of the franchise is preserved.
Key takeaways
- Activision will develop future Halo games, taking over from the internal Halo Studios team.
- Xbox announced an additional 268 job cuts, continuing a broader restructuring that began earlier in the year.
- Other studios, notably Ninja Theory, face consultation and possible closure, while some previously affected studios have returned to management.
- The restructuring aims to streamline Xbox’s portfolio, with Activision’s expanded role covering Halo, Age of Empires, Sea of Thieves, and the Bethesda‑Obsidian partnership.
While the long‑term impact on Halo’s legacy remains uncertain, the combination of layoffs and a new development partner signals a decisive pivot for Microsoft’s flagship franchise. Observers will be watching closely to see whether Activision can deliver a title that lives up to the franchise’s storied past while navigating the challenges of a heavily restructured Xbox ecosystem.