Microsoft is restructuring Xbox as part of a wider reset involving around 3,200 job cuts, consolidating studios, shifting major franchises and making some teams independent. Halo development is moving from Halo Studios to a new Activision-led team, while the changes further weaken Xbox’s traditional identity as a console-focused business with a clear stable of exclusive games.

The latest wave includes 268 roles being eliminated across Halo Studios, other first-party teams and central management. Rare and World’s Edge will move under Activision, Obsidian under Bethesda to focus on Fallout, casual games under King, and Playground will merge with Turn 10; earlier cuts included 1,600 redundancies, with another 1,600 planned, alongside Double Fine and Compulsion becoming independent. Microsoft says the strategy aims to reach more than one billion daily users while concentrating investment on established franchises such as Minecraft, Halo, Fallout and Candy Crush, and reconsidering its Game Pass spending.