Microsoft cuts 268 Xbox roles, consolidates studios and shifts Halo to new developer

Microsoft has announced significant restructuring across its Xbox division as part of broader layoffs affecting approximately 3,200 employees. The changes include eliminating 268 positions spanning Halo Studios, other first-party game studios, and Xbox Game Studios management. Some studios are being consolidated while others face potential closure, marking a major shake-up of Xbox's internal development structure. Most notably, the Halo franchise — Xbox's flagship series — is being handed off to a new developer. The moves have raised widespread concern about the long-term direction and identity of the Xbox brand.