Halo to Activision. Xbox merges studios and cuts 268 jobs

Xbox has reorganized its studio business, with several developers now reporting into either Bethesda or Activision Blizzard.

Meanwhile, Hellblade developer Ninja Theory faces closure after two buyout talks fell through.

Halo will now be entirely led by Call of Duty publisher Activision. Halo Studios will continue to support existing in-market projects, while a new purpose-built team will make the next Halo game.

Sea of Thieves developer Rare and Age of Empires division World’s Edge will also report to Activision.

Developer Obsidian will report directly to Bethesda. Obsidian is already working on a new Fallout game for the publisher.

Forza Motorsport developer Turn10 will be folded into Forza Horizon studio Playground Games.

Undead Labs will now become an independent studio, with an unnamed publisher handling the release of State of Decay 3. The game will continue to be released in Game Pass on day one.

Finally, Microsoft’s casual games division will report into Candy Crush company King.

As a result of these changes, there will be 268 job cuts across Halo Studios, other first-party teams and the Xbox Game Studios central organization.

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“We’re thrilled to welcome Halo, Rare, and World’s Edge to Activision,” said Activision president Rob Kostich. “It’s an honor and a responsibility that we do not take lightly.  These teams and their games have inspired fans around the world for decades.

“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.

“To the World’s Edge and Rare teams, we can’t wait to get to work together.”

Xbox Chief Creative Officer Matt Booty said: “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 announced it would cut 3,200 jobs as part of a major restructure in July. This included the removal of five studios. Double Fine (Keeper), Compulsion Games (South of Midnight, Ninja Theory (Hellblade), Undead Labs (State of Decay) and Arkane Lyon (Dishonored).

The Arkane process is on-going and expected to continue until the end of 2026.

The company says it is three quarters of the way through its planned restructure.

The initial wave of 1,600 job cuts included job losses at Obsidian, Bethesda and id Software, alongside significant reductions across the Xbox platform team, which covers hardware, software services, xCloud and Game Pass.

Xbox says the job cuts will allow it to invest in other areas. It has already signed ambitious new IP Physint from Kojima Productions.

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