In its second restructuring wave this year, Xbox laid off 268 employees while attaching Halo and Rare to Activision, Obsidian to Bethesda; Playground Games and Turn 10 Studios merged. It was announced that Ninja Theory is undergoing consultation during a closure process, while Arkane's future remains uncertain.
In its second major restructuring wave this year, Xbox laid off 268 employees while restructuring some of its first-party studios. According to a message sent by Matt Booty, the company's head of content, to Xbox employees and later made public, the layoffs cover Halo Studios, other first-party studios, and the XGS management and central functions layer.
Booty stated that the steps taken, including the studio divestitures completed since July, have completed approximately three-quarters of the previously announced restructuring plan.
Changes in Studio Structure
According to the company's statement, Xbox will operate with fewer business units to strengthen its brands and games, bringing together groups that already work closely together and focusing on publishing expertise.
As part of this, the Halo series, along with Age of Empires developer World's Edge and Sea of Thieves maker Rare, were transferred to Activision. The new Halo game will be developed by a team established specifically for this purpose, separate from Call of Duty's ongoing development and plans. The remaining part of Halo Studios will continue to support the Halo community and games currently on the market.
The Outer Worlds and Avowed developer Obsidian was brought under Bethesda. Forza and Fable makers Playground Games and Turn 10 Studios were merged under a single studio that will develop new games for these two series. Mobile game company King absorbed Microsoft Casual Games, which develops Microsoft's solitaire, sudoku, and mahjong applications.
Status of Former Studios
Booty also shared an update regarding the studios that parted ways in July. Hellblade developer Ninja Theory is undergoing consultation during a possible closure process after two acquisition deals failed.
Undead Labs, Compulsion Games, and Double Fine avoided this fate and became independent studios owned by their employees, finding a new publisher for State of Decay 3, which maintains its 2027 release target. The future of Dishonored developer Arkane remains uncertain; the consultation process regarding the studio's status is expected to continue until the end of the year.
Union Statement
The Communications Workers of America (CWA) union issued a statement regarding this layoff wave. According to the union's statement, while 268 game workers lost their jobs, the union does not expect today's layoffs to affect workers represented by the union.
The union stated that earlier this month, its members at Blizzard Entertainment secured layoff protections and rehiring rights. Additionally, according to an internal email seen by Game Developer, Blizzard developers were informed that they were not affected by today's announcements.
