Activision Takes Over the Next Halo Game as Xbox Cuts 268 Roles

Microsoft is changing how it manages the Halo franchise as part of a broader restructuring of its Xbox gaming business. Activision will develop the next Halo title through a new purpose-built team, while eliminating 268 roles across Halo Studios, other first-party studios, and Xbox Game Studios management and central functions.

Xbox chief content officer Matt Booty announced the changes on September 22, 2026. Microsoft said the restructuring, which began earlier in the year, was roughly three-quarters complete at that point. Xbox’s official restructuring announcement provides details on the latest changes.

Activision Will Develop the Next Halo

The biggest change for the franchise is moving development of the next Halo game to Activision. Microsoft says a new purpose-built team will lead the project, separate from ongoing Call of Duty development and plans.

The announcement does not identify the new team’s name, size or location, and it does not reveal the next game’s release date, story or gameplay details. For now, the confirmed change is that Activision will oversee development through this dedicated Halo team.

The move also does not mean that all Halo development is leaving Halo Studios. Microsoft says a small team at Halo Studios will continue supporting Halo games already in the market and the wider Halo community.

Halo Studios Has Already Gone Through Major Changes

The latest restructuring follows an earlier transformation of Halo’s development organisation. In 2024, Microsoft renamed 343 Industries as Halo Studios and announced that future Halo projects would use Unreal Engine 5.

Microsoft’s announcement about Halo Studios and Unreal Engine 5 said multiple new Halo games were in development and described changes to the studio’s development approach and team structure.

Microsoft presented the transition as a new phase for the franchise rather than simply a name change. Halo Studios also introduced Project Foundry as a research effort to explore what the team could achieve with Unreal Engine 5.

268 Roles Are Being Eliminated

Microsoft says it is eliminating 268 roles across Halo Studios, other first-party studios, and the Xbox Game Studios management and central functions layer.

The company has not said that all 268 reductions are within Halo Studios. The figure covers several parts of the Xbox organisation, making it different from a Halo-only headcount reduction.

The cuts follow a much larger restructuring announced in July. Xbox said then that it planned to reduce its workforce by approximately 3,200 people during fiscal 2027, including approximately 1,600 immediate role eliminations. Xbox’s July restructuring announcement outlined the wider plan.

Activision’s Responsibilities Are Expanding

Halo is not the only franchise responsibility moving toward Activision. Microsoft says Activision will also expand its remit to include World’s Edge and Rare.

World’s Edge is associated with the Age of Empires franchise, while Rare is the studio behind games including Sea of Thieves. The changes place more Xbox development responsibilities within Activision’s part of Microsoft’s gaming organisation.

Microsoft completed its acquisition of Activision Blizzard King in October 2023. Microsoft’s announcement welcoming Activision Blizzard King to Xbox described the acquisition as bringing Activision, Blizzard and King into the company’s gaming business across console, PC and mobile.

Halo Studios Will Continue Supporting Existing Games

Microsoft has specifically separated the future development team from the smaller Halo Studios group that remains in place. That team will continue supporting existing games and the Halo community.

This means the restructuring announcement does not indicate that Microsoft is abandoning existing Halo services or games. Microsoft has not announced a separate change to their support arrangements as part of the September reorganisation.

Halo’s current development history also includes Halo: Campaign Evolved, a remake of the original Halo: Combat Evolved campaign. Xbox’s official information about Campaign Evolved describes it as a ground-up Unreal Engine 5 remake with new content and expanded cooperative features.

The Next Halo Game Has Few Confirmed Details

Microsoft has not announced the title of the next Halo game developed by Activision. The restructuring announcement also includes no confirmed release window, platform list, story outline, or detailed gameplay information.

The company also has not explained how the new team will be staffed or whether developers from other Xbox studios will move into the organisation. Those details remain undisclosed.

That makes it important to separate the confirmed organisational change from speculation about what the next Halo game might become. So far, Microsoft has confirmed the developer structure, but not the project’s creative direction.

Other Xbox Studios Are Being Reorganised

The Halo change is part of a wider restructuring across Microsoft’s gaming business. Bethesda is expanding its remit to include Obsidian, while King will take responsibility for Microsoft Casual Games.

Playground Games and Turn 10 Studios are also being combined into one organisation focused on the Forza and Fable franchises. Microsoft says the two studios have worked as creative and franchise partners for more than a decade.

Other studios are changing ownership or management arrangements. Compulsion Games and Double Fine have returned to independent management, while Undead Labs has transitioned under new management. Microsoft also says consultation involving Arkane remains underway and that Ninja Theory is facing consultation over a proposed closure after two agreements fell through.

Why Microsoft Is Changing the Structure

Microsoft says the restructuring aims to run fewer business units, align groups that already work closely together, and focus publishing expertise. The company says these changes are intended to strengthen its franchises and games.

The July restructuring announcement also described plans to simplify management layers and change how Xbox operates across content, hardware, platform and services. Microsoft’s explanation of the Xbox reset provides the broader context for those organisational changes.

The September changes therefore affect more than individual game teams. They are part of Microsoft’s attempt to reorganise its large gaming portfolio after years of expansion through acquisitions and internal growth.

What the Halo Change Means

For Halo, the clearest change is that responsibility for the next major title is moving from the existing Halo Studios structure to a new Activision-led team. Halo Studios itself remains involved in supporting current games and the community.

The change also follows Microsoft’s earlier decision to rename 343 Industries, adopt Unreal Engine 5 for future Halo projects and develop multiple new experiences. The latest move introduces another change in how the franchise is organised.

However, the restructuring announcement does not provide enough information to determine how Activision’s involvement will affect the game’s design, development schedule or creative direction.

Final Verdict

Microsoft’s latest Xbox restructuring moves development of the next Halo title to a new purpose-built team under Activision while eliminating 268 roles across several parts of the Xbox organisation.

Halo Studios will continue supporting existing games and the Halo community, while the new Activision team takes responsibility for the next major title. The change is part of a broader restructuring that is also moving other studios and franchises into new organisational groups.

For now, the development structure is the main confirmed detail. Microsoft has yet to reveal the next Halo game’s title, release timing or gameplay plans, so the project’s eventual direction remains to be announced.