Microsoft Gives Next Halo Game to Activision Amid 268 Xbox Job Cuts

Microsoft has handed development of the next mainline Halo game to Activision, the publisher behind Call of Duty. A new team created specifically for the project will work separately from Activision’s current Call of Duty development.

At the same time, Xbox announced cuts affecting 268 employees across Halo Studios, other internal teams and central Xbox Game Studios divisions. Most of the layoffs are at Halo Studios.

New team assigned to Halo

Xbox Game Studios head Matt Booty said Activision’s Halo team would operate independently of Call of Duty teams. A smaller Halo Studios group will continue supporting the community and previously released games.

Microsoft has not announced a release date or explained what form the next Halo project will take. It is also unknown whether the game will reboot the series or build on Halo Studios’ existing work.

Xbox studio restructuring

The move continues changes Microsoft announced during the summer. Rare, the studio behind Sea of Thieves, and World’s Edge, which oversees Age of Empires, are also moving under Activision’s structure.

Booty said the changes are intended to reduce the number of separate business units, bring together teams that already work closely, and focus publishing resources on key franchises.

Halo Studios’ recent history

Microsoft acquired the Halo franchise with Bungie in 2000. After Bungie separated from Microsoft in 2007, the company created 343 Industries, which developed Halo 4, Halo 5: Guardians and Halo Infinite.

343 Industries was renamed Halo Studios in 2024. The team had announced several new Halo games using Unreal Engine, including the experimental Project Foundry. It remains unclear how much of that work Activision’s new team will use.