Xbox Lays Off 268 More People, Hands Halo Series To Activision

Earlier this year, Xbox performed a massive wave of layoffs, eliminating 1,600 roles and sharing that more cuts would come soon. Today, those cuts have come: Xbox has announced it is laying off 268 roles across its first-party studios, XGS management, and central functions layer. Halo Studios in particular has been significantly impacted, and today’s announcement states that Activision will take over development for the next Halo title.

The news broke via an Xbox Wire post called “Continuing Our Reset,” by Xbox executive vice president and chief content officer Matt Booty. It makes three major points. First, it lays out the layoffs and says the company is “roughly three-quarters of the way through previously announced restructuring.”

Next, he announces some internal studio restructuring. Activision will expand its remit to World’s Edge (known for Age of Empires) and Rare (known for Sea of Thieves), and a new team will be created within Activision to develop the next Halo title. Meanwhile, a “small team at Halo Studios will continue supporting the Halo community and games in-market.” This last part is huge news – the makers of Call of Duty are now also in charge of Halo. It’s perhaps the clearest example of how massive studio mergers can ultimately stifle competition – the two series hailed as the pillars of the first-person shooter are now being made under the same roof.

Other studios are also getting shuffled around. You can read Booty’s breakdown verbatim below:

• Bethesda will expand its remit to include Obsidian, which will continue its current projects, including Grounded, as well as the new Fallout project made in collaboration with Bethesda Game Studios.

• King will expand its remit to include Microsoft Casual Games, uniting our two global leaders in casual game design and live operations.

• Playground and Turn 10 will come together as one studio focused on the Forza and Fable franchises. These two studios have been creative and franchise partners for over a decade, and today’s changes will formally move their work into one team.

The final note details Xbox’s studio divestitures, which it announced a few months back. Compulsion and Double Fine have officially spun off to run independently, and Undead Labs has a deal with a new publisher, but will still release State of Decay 3 on Game Pass when it launches next year. On the other hand, “two separate agreements for Ninja Theory fell through,” and Xbox will begin consultations on a proposed closure. Arkane is in a similar position, though Booty says those consultations are expected to last “through the end of the year.”

The news is unfortunate across the board, but the cuts to the Halo team are especially impactful. Halo: Campaign Evolved was one of our most recent cover stories, and we enjoyed the final product at launch, but it seems to have done little to hold off Xbox’s all-encompassing waves of cuts. Meanwhile, Halo’s original creators at Bungie also laid off “most of” the Destiny 2 team, though Bungie also recently announced plans to bring back vaulted Destiny 2 content.