Activision Takes Over Next Halo Game as Xbox Shrinks Halo Studios

What Xbox actually announced​

The news came in an employee memo from Xbox Chief Content Officer Matt Booty, which Xbox also posted publicly on Xbox Wire under the title "Continuing Our Reset." It is dated September 22, 2026. In it, Booty says Activision will also be developing the next Halo title, led by a new, purpose-built team that is separate from ongoing development and plans for Call of Duty. He adds that a small team at Halo Studios will continue supporting the Halo community and games in-market.

The memo stops there. It does not say:

• how large the new Activision team is, who leads it, or where it is based
• what the game is, what stage it's at, or when it might ship
• how many people stay at Halo Studios, or exactly what their support work covers
• what "separate from Call of Duty" means in practice, such as whether the team will share engines, tools or publishing systems

Some coverage has called the project the next "mainline" Halo. Thurrott, for example, wrote that Activision will also oversee the next mainline Halo game, which will be developed by a brand new team. That is a fair reading, but Xbox's memo only says "the next Halo title."

The most quoted line didn't come from the memo at all. The Next Web reported that Activision president Rob Kostich gave a statement saying the goal is to make the greatest Halo game ever, worthy of its universe and legacy, while staying true to what made players love it in the first place. According to The Next Web, he said the team is already being assembled. So the "greatest Halo ever" ambition belongs to Activision's president, not to Booty's memo.

Section summary: The handoff and the small Halo Studios support team are officially confirmed. The game's details, schedule and the practical meaning of its separation from Call of Duty have not been announced.

The rest of the reorganization​

Halo was one of several moves in the memo. Booty described the goal as strengthening franchises by running fewer business units, grouping teams that already work closely together, and concentrating publishing expertise. Here are the confirmed changes:

Inven Global gave readers some context on the studios involved: Activision's expanded remit covers World's Edge, developer of 'Age of Empires', and Rare, developer of 'Sea of Thieves'. Engadget and Inven both describe Playground and Turn 10 as merging. Xbox's own wording is softer: the two will "come together as one studio." Neither the memo nor the coverage explains what happens to their separate management.

268 jobs, and Xbox says it's three-quarters done​

The reorganization came with more layoffs. The memo says Xbox is cutting 268 roles across Halo Studios, other first-party studios, and the Xbox Game Studios management and central functions layer. Booty wrote that "the actions completed since July, inclusive of the studio divestitures, bring us roughly three-quarters of the way through previously announced restructuring."

Engadget explained the bigger picture: in July, Xbox laid off 1,600 people and said it would cut the same number of jobs over the following year as it chases greater efficiency and higher profit margins. Engadget also said it appears Halo Studio is bearing the brunt of the latest cuts, though Xbox isn't closing it entirely. That's a reasonable conclusion, but it is still an inference. Xbox has not said how many of the 268 jobs were at Halo Studios.

The memo also gave updates on studios Xbox is spinning off or selling:

• Compulsion Games and Double Fine became independent again in August, keeping their IP, back catalogs and runway funding.
• Undead Labs went independent on similar terms. With a new publisher, it will release State of Decay 3 on Game Pass on day one.
• Ninja Theory: in Booty's words, "Unfortunately, two separate agreements for Ninja Theory fell through. We will now begin consultation with employees on a proposed closure while continuing to explore other paths forward."
• Arkane: consultation is still underway and is expected to continue through the end of 2026.

Section summary: Halo's change of developer is part of a cost-cutting reset that also includes layoffs, consolidation and studio sales. It wasn't a standalone creative decision.

What we know, what's reported, and what's just talk​

Here is how the claims stack up.

Confirmed by Xbox: Activision is developing the next Halo title with a new team kept separate from Call of Duty. A small Halo Studios team will keep supporting existing games and the community. 268 roles are being cut.

Reported but not confirmed: WindowsForum's earlier coverage pointed to The Verge's Tom Warren, who reported that Halo Studios' own next Halo project was still "years away from shipping" when Microsoft cancelled it. Microsoft has not commented on that project.

Speculation: Some outlets, including AWN China, have mentioned a possible lore reboot, wider cross-platform releases, and a fix for Halo's slow development cycles. None of that is in Xbox's announcement. Treat it as opinion, not news.

As for games already out, Thurrott guessed that "games in-market" mostly means Halo: Infinite and the freshly released Halo: Campaign Evolved. That makes sense, but Xbox didn't spell it out. Gadget Hacks noted that the memo did not mention that game by name.

Analysis: why this matters beyond fan reaction​

This section is my analysis, based on general industry knowledge, not on statements from Xbox.

This is what buying Activision was for. Microsoft spent heavily on Activision Blizzard, and this is the clearest case yet of the company using Activision's shooter expertise on one of its own franchises instead of just collecting Activision's games. Few teams in the industry ship big first-person shooters on a schedule as reliably as Activision does. Microsoft's memo itself only talks about "focusing our publishing expertise." Anything beyond that is our interpretation.

Xbox is grouping studios under fewer bosses. Activision now oversees Rare, World's Edge and the next Halo. Bethesda gets Obsidian. King gets the casual games. Xbox is moving away from a long list of semi-independent studios toward a few large groups. You could describe it as roughly organized by genre, but Xbox hasn't put it that way, and Rare and Age of Empires under the Call of Duty publisher don't fit a neat "shooters" label.

Fans' fear of a "Call of Duty-ized" Halo is real, but so far it's only a fear. Halo and Call of Duty were direct rivals for most of the Xbox 360 era. Halo had arena-style shooting, shields, and a slower, more deliberate pace. Call of Duty is about fast kills, loadouts and seasonal monetization. Xbox insisting on a team "separate from Call of Duty" looks like an attempt to address that worry ahead of time. But without operational details, readers should take it as a commitment about how the teams are organized, not proof of how the game will play.

The counterargument deserves a hearing. Halo Studios has a name built around the franchise, the hard-won experience of moving to Unreal Engine, and years of contact with the community. Moving the next game to a brand-new team means rebuilding a lot of that knowledge from scratch. Is a new team inside an experienced publisher faster than an experienced team inside a studio that's struggling? Nobody knows yet. Halo has already been through this once, when Bungie handed the series to 343 Industries, and that transition was rough for years.

What it means for Xbox and PC players right now​

• Halo games you already own: Nothing announced affects them. Xbox says a Halo Studios team will keep supporting games already on sale. It hasn't said what that support includes, such as content updates or how quickly fixes arrive, so lower your expectations for big new seasons until Xbox says more.
• The next Halo: There's no title, platform list or release window. Kostich says the team is still being assembled, so if you're hoping to play it soon, don't count on it.
• Game Pass and other Xbox studios: The State of Decay 3 deal keeps that game on Game Pass at launch even though Undead Labs is now independent. That's the clearest sign so far of how Xbox handles spinning off a studio.
• What to watch next: Booty pointed to an October 6 town hall to look ahead to "one of the strongest game lineups in our history." In the coming months, look for news on Ninja Theory and Arkane, and the first official details about the new Activision Halo team.

Microsoft's first big experiment after buying Activision is also its riskiest: giving the series that defined Xbox to the publisher that used to be its main rival. Whether that turns out to be smart or a mistake depends on a game that doesn't have a name yet.