Xbox’s planned restructure is roughly three-quarters complete, while the company plans to eliminate 268 roles across Halo Studios, other first-party studios, and the Xbox Game Studios management and central functions teams. Matt Booty outlined the next phase in an announcement to Team Xbox employees on Sept. 22, 2026.
Actions completed since July, including studio divestitures, have moved Xbox through roughly three-quarters of its previously announced restructuring. The company is reducing the number of business units and grouping teams that already work closely together, with the stated aim of putting more focus on its franchises, games, and publishing operations. The reset is therefore a studio map as much as a headcount exercise.
Xbox connects Halo, Forza, and Fable teams
Activision will expand its responsibilities to include World’s Edge and Rare. It will also develop the next Halo game through a new purpose-built team that will operate separately from Halo’s ongoing development and Call of Duty plans. A smaller team at Halo Studios will continue supporting the existing games and their communities.
Playground Games and Turn 10 will become one studio focused on the Forza and Fable franchises. Booty described the teams as creative and franchise partners for more than a decade, with the new structure formally bringing their work together.
Bethesda will add Obsidian to its group of studios. Obsidian will continue its current projects, including Grounded, along with the new Fallout project being developed in collaboration with Bethesda Game Studios. King will also take on Microsoft Casual Games, joining two major teams working in casual game design and live operations.
Undead Labs transitions while Ninja Theory faces consultation
Compulsion Games and Double Fine returned to management in August with their intellectual property, back catalogs, and runway funding. Undead Labs has now made a similar transition, and its next game, State of Decay 3, will release day one on Game Pass under a new publisher.
Two separate agreements involving Ninja Theory fell through. Xbox will begin consulting employees about a proposed closure while it continues looking for other options. Consultation with Arkane is still underway and is expected to continue through the end of 2026.
Booty said he would spend time with the studios during the week following Sept. 22. The wider Xbox organization will meet at an all-team town hall on Oct. 6 to review the reset and look ahead to its upcoming lineup.
How do you expect Xbox’s new studio structure to affect Halo, Forza, and Fable, and what should happen to Ninja Theory as the final quarter of the reset approaches? Share your thoughts in the comments, and follow us on X, Bluesky, YouTube, Instagram, Steam, and Telegram.
