Halo to Activision: Xbox Merges Studios and Cuts 268 Jobs

Xbox has initiated a significant organizational restructuring, resulting in 268 job cuts across its internal studios and central operations. This move is part of a broader, ongoing effort by the company to consolidate its business units and streamline its publishing expertise. The company reports that it is currently three-quarters of the way through a larger, multi-phase restructuring plan that previously included a 3,200-job reduction announced in July 2026.

The reorganization involves a major realignment of studio reporting lines. Halo Studios will now operate under the leadership of Activision, with a dedicated team tasked with developing the next entry in the franchise. Additionally, Rare and the World’s Edge division have been moved under the Activision umbrella, while Obsidian will now report directly to Bethesda. Other notable changes include the integration of Turn10 into Playground Games, the transition of Undead Labs to an independent studio model, and the alignment of the casual games division with King. Meanwhile, Ninja Theory faces potential closure following unsuccessful buyout negotiations.

These structural changes reflect a strategic shift toward centralizing resources under established publishing labels like Activision and Bethesda. While the company continues to reduce its headcount, it maintains that these efficiencies are necessary to support future investments, such as the development of new intellectual property. The ongoing restructuring process, which has already impacted various segments including hardware, software services, and cloud gaming, is expected to continue through the end of 2026.