Halo Studios, the team behind the modern iterations of XBOX’s flagship first-person shooter game, may as well soon be called simply “Studios”, as recent announcements by the XBOX vice president Matt Booty outlined a “continuing [of the company’s] reset” which seems to be curbing the developer’s involvement in both the franchise and the console’s future.
The “reset” in question here refers to an announcement by XBOX CEO Asha Sharma in July 2026, where Microsoft unveiled their decision to lay off 3,200 XBOX employees as part of the “most significant” restructuring in company – and potentially industry – history, proposed as a necessity to move forward as a competing vector in the console business. Half of these job cuts were conducted in tandem with the original announcement, while the second half would be decided and announced over the next financial year.
It seems the day to continue that unfortunate restructuring has come, as 268 roles at “Halo Studios, other first-party studios, and the [XBOX Game Studios] management and central functions layer” are about to be eliminated, per Booty’s announcement to the global XBOX team. He went on to say that, following this decision, the 3,200 layoffs project will be “roughly three-quarters of the way through”.
While the Halo team is not the only XBOX subsidiary facing a shake-up, they are arguably the studio whose fate has changed the most per the announcement. Booty described the left-over skeleton crew as “small”, working to support the Halo community and future games “in-market”. Beyond this, he announced that the franchise’s next project – which could be a complete series reboot, or continuation of 2021’s ill-named Halo Infinite – would actually be developed by Activision, led by a “new, purpose-built team” seemingly not overlapping with the studio’s annual Call of Duty slate.
This shift in development marks the first time since 2012 where 343 Industries – who rebranded to Halo Studios in October 2024 – have not been the team to lead a mainline Halo title. As much as this appears bleak for the franchise’s future, it does make sense: Halo Infinite was apparently a major financial disappointment for Microsoft, failing to take shape as the decade-spanning live-service title they had envisioned it to be.
To top it off, the studio’s newest title Halo: Campaign Evolved, a ground-up remake of the game that started it all, has received tepid review scores and reportedly only “soft” sales figures, likely attributed to its day-one release on XBOX Game Pass. It’s now also the second time the original Halo title has been repackaged, though this time without a PvP multiplayer despite the £49.99 price point. While it branched the franchise over to new consoles, it also didn’t leave much of anything worth chewing on, tapering off in the weeks post-launch.
There’s certainly a depressing irony to be found regarding the state of job security in the gaming industry, a world where a team literally named Halo Studios can have their namesake franchise handed off to someplace else with – on our end, anyway – what looks like the press of a button. While it’s certain Halo isn’t going anywhere, this novel transfer of ownership raises questions regarding whether XBOX’s once-crown jewel can ever re-unite with its former glory from the Bungie era, now relegated to an ostensible B-project in Activision’s shooter depository. Per The Hollywood Reporter, Activision president Rob Kostich outlined his “bold ambition [to] make the greatest Halo game ever”, so it seems that reconciliation is XBOX’s end goal.
