Activision Halo, Hellblade developer threat to shut down and massive layoffs: Xbox announces new phase of massive restructuring

Surrounded by various rumors, a new round of layoffs in Microsoft’s gaming department is coming soon. Unpleasant news in an open letter to employees shared Matt Booty, Chief Content Officer, Xbox.

Image source: Xbox

First, Xbox will lay off 268 people across Halo Studios, other internal studios, management and central Xbox Game Studios Services. The layoffs are part of a major restructuring announced by the department in July.

According to Booty, coupled with the adjustments in July (laying off 1,600 employees and divesting 5 game studios) and September, the Xbox restructuring is about 75% complete.

Second, Xbox is reorganizing its studios to reduce divisions and strengthen franchises:

• Activision now includes World’s Edge (Age of Empires series) and Rare (Sea of ​​Thieves) studios, and will also be working on the next Halo game – a small team at Halo Studios will continue to support older Halo games;
• Obsidian Entertainment will become part of Bethesda Softworks, which will have a positive impact on the joint development of new Fallout;
• Playground Games (Forza Horizon, Fable) and Turn 10 Studios (Forza Motorsport) will be the studios responsible for the Forza and Fable series;
• Microsoft Casual Games will become part of King – together they will focus on casual and service games.

Third, Xbox shared news about the five studios it decided to part ways with in July:

• Compulsion Games (We Happy Few, South of Midnight) and Double Fine Productions (Psychonauts 2) became independent again in August;
• Undead Labs (State of Decay series) has now been handed over to new owners and is preparing State of Decay 3 to be released on Game Pass at launch;
• Two deals to sell Ninja Theory (Hellblade series) to new owners have failed – Xbox will continue to consider other options, including closing the studio;
• Negotiations for Arkane Studios (Marvel Blade, Deathloop, Dishonored II) to exit Xbox will continue until the end of the year.

In June, Ninja Theory launched a new game-action game Senua

The Xbox restructuring is the initiative of new chief executive Asha Sharma, who has acknowledged the business needs a reboot amid the unit’s poor performance.

Booty also announced that it will hold an all-hands meeting of Xbox executives on October 6 to discuss the progress made and “One of the strongest game series in our history”.