REPORT: Xbox Cuts 268 Jobs From First Party Studios, Activision Developing New Halo Game
"Our goal is clear: make the greatest Halo game ever"
"ColonelFancy" Mike Lind
9/22/20262 min read
Xbox consolidates operating units to fewer teams
Double Fine and Compulsion Games return to independent development
Ninja Theory shuts down completely
Development of next Halo game shifts entirely to Activision
Microsoft is not quite done with slashing jobs at their games division, as efforts to redefine the brand leads to bleeding off further factions of the staff. There's also a major shake-up for Halo, one of the Xbox's defining brands, which could lead to interesting implications. In an official statement from Matt Booty to the global Xbox team, 268 jobs will be eliminated from Halo Studios, and other first party development teams. This is meant to streamline their operating forces, and have teams that are already working close together working even closer. The former 343 Studios (which rebranded to Halo Studios) is now reduced to an incredibly small work force that will continue to support for Halo Infinite and other related games.
Today, our focus should be on supporting those affected and treating one another with care and respect. I will spend time with our studios over the next week. At our October 6 town hall, we will come together as an ALL-XBOX team to reflect on our progress and look ahead to one of the strongest game lineups in our history.
Activision will now take over development of the next mainline Halo game. A major standalone Halo project titled "Project Ekur", a planned multiplayer endeavor, was cancelled in July 2026. Banjo-Kazooie developer Rare will also now report directly to Activision, as well as Age of Empires studio World's Edge. With projects for Call of Duty already in the pipeline, this is a lot of management workload.
Obsidian will now also move under Bethesda's management and report to them. Obsidian continues work on the Grounded series, as well as being tasked with a new Fallout game, and a potential Avowed sequel. King takes on overseeing projects from Microsoft Casual Games (Mahjong, Minesweeper, Microsoft Solitaire Collection).
Unable to find new deals, Senua developer Ninja Theory may face complete closure
Studios Playground Games and Turn 10 Studios will combine into one development team, and will continue to work on their series, Forza and Fable, respectively.
"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," Booty continues in the statement.
Compulsion Games (South of Midnight), Undead Labs (State of Decay 3), and Double Fine Studios (Psychonauts 2), three teams Xbox decided to divest, will proceed with their independent operating plans. Arkane Austin and Ninja Theory, however, are not so lucky. Arkane Austin has been closed permanently, and plans to sell Ninja Theory fell through the cracks, leaving the Cambridge-based game developer likely to close completely, as they are not a part of Xbox's restructuring strategy.
Activision president Rob Kostich made a statement to GameFile.com regarding the restructuring and the prospects of working on a brand new Halo game:
For Halo, our goal is clear: 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. It is a bold ambition, one that this franchise deserves. We have already begun assembling a purpose-built team, unique in capability and talent, ready and excited to deliver this next chapter with the community.”
SOURCES: Xbox.com, GameFile.com