Microsoft is eliminating another 268 positions across its Xbox business as it continues a broader restructuring of its gaming operations, including changes to the organisation of several studios and major franchises.
The latest reductions affect employees at Halo Studios, other first-party development teams, as well as Xbox Game Studios’ management and central functions.
The cuts follow Microsoft’s larger restructuring announced in July, which included plans to eliminate approximately 3,200 positions, representing about 20% of the affected Xbox workforce.
Xbox restructuring enters later stages
Microsoft said the restructuring programme launched in July is now approximately 75% complete.
The changes extend beyond workforce reductions, with Microsoft reorganising studio responsibilities, consolidating teams and changing how several gaming franchises are managed.
Under the new structure, Activision will expand its responsibilities to include Rare and World’s Edge. A new team within Activision will also take charge of development of the next Halo game.
The new Halo development team will operate independently from Activision’s Call of Duty operations.
Halo development changes hands
The latest restructuring changes the way Microsoft manages one of its most established gaming franchises.
A smaller team will remain at Halo Studios, the organisation previously known as 343 Industries. Its responsibilities will include supporting existing Halo titles and maintaining the game’s player community.
Halo Studios is also among the organisations affected by the latest round of job reductions.
The next major Halo title will therefore be developed by a newly established team under Activision rather than the studio traditionally associated with the franchise.
Bethesda to oversee Obsidian
Microsoft is also changing the reporting structure for several other studios.
Bethesda will assume responsibility for Obsidian Entertainment, while Obsidian will continue development work on Grounded and collaborate with Bethesda Game Studios on a new Fallout project.
Elsewhere, Playground Games and Turn 10 Studios will be combined into a single studio responsible for the Forza and Fable franchises.
Microsoft’s casual gaming operations will also be reorganised, with King, the company behind Candy Crush, taking responsibility for Microsoft Casual Games.
Some studios move outside Microsoft
The restructuring also includes changes involving studios that Microsoft has been seeking to divest.
Compulsion Games and Double Fine returned to their management teams in August, along with their intellectual property and back catalogues. Undead Labs has since completed a similar transition.
The future of Ninja Theory remains unresolved. Microsoft said two proposed agreements involving the studio did not proceed and that it will begin consultations with employees regarding a possible closure while continuing to consider other options.
Discussions concerning the future of Arkane are also ongoing.
Workforce reductions accompany studio consolidation
The latest 268 job cuts represent another stage in the restructuring that began earlier this year.
Microsoft had previously announced plans to eliminate around 3,200 positions as part of efforts to simplify Xbox’s management structure and reorganise its gaming operations.
The changes now extend across the business, with some studios being consolidated, others reassigned to different divisions and several being moved outside Microsoft’s ownership.
For Xbox, the restructuring is therefore reshaping not only its workforce but also the organisational structure behind some of its largest gaming franchises.
The changes involving Halo are particularly significant because the franchise has been closely linked with Xbox since the original Xbox console launched in 2001. Its next major instalment will now be developed under Activision, representing a new organisational model for the franchise.
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