Activision Takes Over Halo Franchise — Xbox Lays Off Hundreds in Restructuring

Activision is taking control of the Halo franchise. This is the headline consequence of a massive restructuring of Microsoft's Xbox division, which also includes laying off around 268 employees, according to reports from The Verge. The move places Microsoft's most iconic gaming property under the purview of its recent, expensive acquisition, fundamentally altering the structure of its first-party studios.

A 'Massive' Shake-up

The restructuring is significant and swift. Alongside Halo, Activision will also take stewardship of the popular Sea of Thieves and Age of Empires franchises, as The Verge reports. This consolidation follows a tumultuous period for the gaming division. These new layoffs are part of a previously announced plan to cut 3,200 jobs. They come just months after 1,600 Xbox employees were let go in July in what Xbox CEO Asha Sharma called "the most significant restructure in Xbox history." The pattern indicates a deliberate and aggressive effort by Microsoft to reshape its gaming business from the ground up, moving key intellectual property from legacy studios to its new powerhouse.

The New Face of Xbox

This isn't just a corporate shuffle. Handing Halo—a franchise synonymous with the Xbox brand itself—to Activision suggests a profound shift in strategy. Microsoft is effectively betting that Activision's leadership and operational structure are better equipped to manage its biggest titles than the collection of studios it cultivated for two decades. The Verge has noted that these changes contribute to a feeling that the Xbox brand is becoming a "shell of its former self." The identity crisis is real. For years, Xbox was defined by its internal studios and their distinct creations. Now, it appears the center of gravity is rapidly moving toward the teams that built Call of Duty.

While the internal organization is in turmoil, the public-facing machine keeps running. As reported by Pure Xbox, the company recently showcased 10 trailers at the Tokyo PC Gaming Show, highlighting a continued pipeline of content and new additions to its Game Pass service. This creates a strange duality. Inside the company, studios are being consolidated and employees are being laid off. Outside, the message is one of abundance and non-stop content. This suggests Microsoft is attempting to project stability to its customers and subscription base, even as it fundamentally reworks the engine that produces the games.