Microsoft Shifts Halo Development to Activision Following Studio Layoffs
Microsoft is handing development of the next mainline Halo game to Activision after Halo Studios was reduced to roughly 30 employees amid Xbox layoffs. Activision is assembling a dedicated team for the project rather than using its existing Call of Duty studios. The planned Halo 7 is expected to include campaign, PvP and PvE multiplayer, and Forge, while other Halo projects face uncertainty.
Microsoft’s decision follows a severe reduction at Halo Studios, formerly 363 Studios, which now has roughly 30 staff focused on community support and other Xbox work. The next mainline entry, Halo 7, is planned to offer a campaign, competitive and cooperative multiplayer, and the Forge creation suite. Activision is forming a separate team for it instead of drawing on its Call of Duty studios.
The shift also affects other Halo efforts. Halo 2 and Halo 3 remakes and a First Strike-inspired spinoff were reportedly in consideration, but their status is now uncertain. More broadly, Xbox has merged Playground Games and Turn 10 for Forza and Fable work, expanded Bethesda’s role, and given Activision more major projects.
The reorganization could affect Halo players, developers, and Xbox’s workforce. Fans may see changes in release timing or creative direction, while employees at affected studios may face uncertainty or role changes. If Activision’s shared-resource model spreads, other major franchises could follow, potentially reshaping game production jobs and consumer expectations. However, outcomes depend on execution, retention, and whether the new team preserves Halo’s community features.