Xbox has confirmed a significant restructuring that places the future of the Halo franchise in the hands of Activision, the studio behind Call of Duty. The move marks a notable shift for a series that has previously only been developed by Bungie and 343 Industries, later renamed Halo Studios.
On Tuesday, a statement titled Continuing Our Reset was sent to global Team Xbox employees. It announced a wider restructuring that included the elimination of 268 roles across Halo Studios, other first-party studios, and XGS management and central functions. According to the statement, a dedicated and separate team will be created to develop the next Halo game, kept distinct from Call of Duty operations. A smaller team at Halo Studios will remain focused on supporting the current community and existing titles.
A franchise changing hands
The final Halo game developed by Bungie was Halo: Reach in 2010, with Halo Studios overseeing the project ever since. That included the studio’s now-final release, Halo: Campaign Evolved, which received critical acclaim upon its launch earlier in 2026.
This is not the first collaboration between Activision and a Bungie-created property. The two studios worked together on the Destiny franchise from 2010 until a public split in 2019, before Activision was acquired by Microsoft in 2022. During that period, Activision brought in external studios such as Vicarious Visions and High Moon Studios to support PC development and accelerate new content.
Part of a wider cost-cutting reset
The current reset represents a clear pivot in Xbox’s strategy and forms part of Microsoft’s broader cost-cutting restructuring. These efforts began after Xbox CEO Asha Sharma stated that the business “is not healthy.” In July, the company announced 3,200 layoffs over the following year, citing a struggling business and stagnant growth in Game Pass.
Activision is now the developer behind Xbox’s two largest FPS franchises, Call of Duty and Halo. The two series shared an intense rivalry during the 2000s that has softened over time, with Battlefield largely replacing Halo as Call of Duty’s most prominent competitor in the broader gaming landscape.
No details about the next Halo game have been shared, beyond confirmation that it will be developed by Activision.
