Gaming
Halo Just Changed Studios, and Xbox Finally Showed Its New Map
The Xbox overhaul stopped being a rumor on Tuesday morning. Microsoft cut hundreds of additional jobs, including 268 roles across Xbox Game Studios, spanning Halo Studios, other first party studios, and the division's management and operating teams. Total reductions came in under 600 globally, with about 300 in Washington state, and the cuts reached beyond gaming into cloud, AI, marketing, and research. The company says the Xbox restructuring is now about 75 percent complete.
The headline move is Halo. Work on the next Halo game is moving to Activision, the Call of Duty publisher Microsoft acquired in 2023 for $68.7 billion, under a new team separate from the Call of Duty franchise. A reduced team stays at Halo Studios in Redmond to support existing Halo games, the community, and esports. Activision president Rob Kostich said the company has “already begun assembling a purpose-built team, unique in capability and talent,” with the goal 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.”
The rest of the map got redrawn too. Activision is also taking over World's Edge, the Redmond studio behind Age of Empires, and assuming control of Rare, the English studio behind Sea of Thieves. Obsidian Entertainment becomes part of Bethesda, a homecoming sixteen years after it made Fallout New Vegas for Bethesda as an outside developer, and it is working on another game set in the Fallout universe now, with the Grounded survival franchise moving over as well. Turn 10 Studios and Playground Games will merge into a single studio making both the Forza racing games and the Fable series. Microsoft Casual Games, the team behind Solitaire and other Windows bundled titles, moves under King, the Candy Crush maker.
Two studios are still writing their endings. Ninja Theory, the Hellblade studio, is facing a possible shutdown after the July handoff deal fell through along with a second agreement, though Microsoft says it still hopes to hand the studio off. Arkane in France remains the last of five studios Microsoft moved to divest in July with its outcome still unannounced, and consultations there are expected to run through the end of the year. Undead Labs completed the happier version of the story, spinning off on terms similar to Compulsion Games and Double Fine, which went independent in August, with State of Decay 3 still launching on Game Pass on day one under a new publisher.
The strategy language is unusually direct. “The goal is to strengthen our franchises and games by operating fewer business units, aligning groups that already work closely together, and focusing our publishing expertise,” Xbox chief content officer Matt Booty wrote in a memo to employees Tuesday morning. Xbox CEO Asha Sharma has framed the whole effort as a return to growth and profitability, concentrating investment around established audiences after concluding the company would do better focusing on franchises than collecting studios.
For players, the map is suddenly legible. Fewer publishers, bigger franchises, and Halo in the hands of the company that ships Call of Duty on a metronome. Whether that produces a great Halo or just a punctual one is the open question, and Kostich's promise sets the bar high. For developers, the industry's consolidation era keeps compressing, and the 75 percent figure means one more chapter of this story is still to come. Watch the WARN filings and the Ninja Theory outcome. Those two items will tell you how the final quarter of the reset lands.
Quick answers
What is this story about?
The Xbox overhaul stopped being a rumor on Tuesday morning. Microsoft cut hundreds of additional jobs, including 268 roles across Xbox Game Studios, spanning Halo Studios, other first party studios, and the division's management and operating teams. Total reductions came in under 600 globally, with about 300 in Washington state, and the cuts reached beyond gaming into cloud, AI, marketing, and research. The company says the Xbox restructuring is now about 75 percent complete.
Why does this story matter?
For players, the map is suddenly legible. Fewer publishers, bigger franchises, and Halo in the hands of the company that ships Call of Duty on a metronome. Whether that produces a great Halo or just a punctual one is the open question, and Kostich's promise sets the bar high. For developers, the industry's consolidation era keeps compressing, and the 75 percent figure means one more chapter of this story is still to come. Watch the WARN filings and the Ninja Theory outcome. Those two items will tell you how the final quarter of the reset lands.
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