Xbox's radical studio shuffle continues its reset

Microsoft is consolidating its gaming studios under bigger publishers to cut management layers and streamline decision-making.

Sep 22, 2026

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Xbox's radical studio shuffle continues its reset

Microsoft is consolidating its gaming studios under bigger publishers to cut management layers and streamline decision-making.

In brief

Microsoft is consolidating its gaming studios under bigger publishers to cut management layers and streamline decision-making. Xbox is merging independent studios under larger publishers like Activision and Bethesda to reduce bureaucracy and speed up game development. Originally reported by Ars Technica.

Xbox announces major studio restructuring

Microsoft is consolidating its gaming studios under larger publishers as part of its ongoing reset. The move aims to reduce independent operations and streamline decision-making across the company.

Halo moves under Activision control

Halo Studios will become a small support team while Activision takes over development of the next Halo game. The move eliminates remaining staff roles as part of 268 new layoffs announced today.

“make the greatest Halo game ever, worthy of its universe and legacy”

Activision gains three major franchises

Activision gains three major franchises

Beyond Halo, Activision now oversees Rare (Sea of Thieves) and World's Edge (Age of Empires). Microsoft acquired Activision just under three years ago.

Obsidian joins Bethesda for RPG games

Obsidian Entertainment, maker of Fallout: New Vegas and Avowed, now reports to Bethesda. The studio will continue work on Grounded and a new Fallout project with Bethesda Game Studios.

More studios consolidated or sold off

Playground Games and Turn 10 merge into one team, while Microsoft seeks buyers for Ninja Theory and Arkane Studios. The company has already sold Compulsion, Undead Labs, and Double Fine.

Cutting management layers to speed decisions

Cutting management layers to speed decisions

Xbox CEO Asha Sharma previously said work passes through up to 14 layers of management, slowing decisions. Today's restructuring aims to reduce bureaucracy and focus investment on higher priority projects.

“passes through as many as 14 layers of management”

The headline

Xbox is merging independent studios under larger publishers like Activision and Bethesda to reduce bureaucracy and speed up game development.

Read the original on Ars Technica

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