Xbox Lays Off 268 Staff and Hands Next Halo to Activision
Microsoft cuts 268 jobs and restructures studios, assigning Activision to develop the next Halo entry while Ninja Theory faces potential closure.
Key points
- Microsoft has laid off 268 employees across Xbox, Halo Studios, and central management teams as part of a broader restructuring.
- Activision will develop the next main Halo title with a new team, while a smaller group at Halo Studios continues support for existing games.
- Ninja Theory faces potential closure, and studios like Compulsion, Double Fine, and Undead Labs are exiting Microsoft to become independent.
Microsoft has announced the termination of 268 employees across its Xbox division, marking the latest wave in a broader corporate reset. The cuts affect staff in Halo Studios, other first-party developers, and central management functions, signaling a significant contraction in the company’s in-house development capacity.
Simultaneously, the company is reorganizing its studio portfolio to consolidate leadership and resources. These changes involve shifting major franchises under new management structures, a move intended to streamline operations but which raises questions about creative continuity for long-running series.
Activision Takes Over Next Halo
The most notable shift involves the Halo franchise, which will now be developed by Activision. A newly formed, dedicated team within Activision will handle the next main entry, separate from their ongoing Call of Duty projects. A smaller team at Halo Studios will remain to support existing games and community operations.
This arrangement is unusual given that Activision originally published Bungie’s Destiny, a competitor to Halo. For PC players, particularly those on Linux, this creates a specific concern: Activision’s current anti-cheat systems are known to block compatibility with Proton, potentially limiting the next Halo’s availability on non-Windows platforms.
Studio Mergers and Indie Exits
Beyond Halo, Microsoft is consolidating several development units. Activision will now oversee World’s Edge and Rare, while Bethesda will absorb Obsidian, which continues work on Grounded and a new Fallout project. King will merge with Microsoft Casual Games to unify live operations and casual design.
Playground Games and Turn 10 are merging into a single studio focused on Forza and Fable. In a separate development, Ninja Theory faces potential closure after failed negotiations, joining Compulsion and Double Fine in exiting Microsoft to return to independent status. Undead Labs has also reached a similar agreement to split off.
Impact on the Gaming Industry
According to GamingOnLinux, these changes reflect a difficult period for the industry, with significant job losses and uncertainty for veteran studios. While the consolidation aims to improve efficiency, the handover of flagship titles to external publishers like Activision introduces risks regarding development culture and platform accessibility.
The immediate consequence for consumers is a potential shift in how these games are built and supported. The transition of Halo to Activision, for instance, may alter the game’s technical requirements and long-term support, making the outcome a critical test of Microsoft’s new strategy.
