Xbox has officially confirmed the next wave of its FY27 reset: 268 roles eliminated across Halo Studios, other first-party studios, and the Xbox Game Studios management / central functions layer, per a Matt Booty memo published on Xbox Wire on September 22, 2026 (Xbox Wire; also Gematsu, Polygon). Booty says actions since July — including prior studio divestitures — put Xbox roughly three-quarters of the way through the previously announced ~3,200-role FY27 restructuring.
Studio remits — Halo, Obsidian, King, Playground/Turn 10
Booty’s memo maps a major publishing realignment:
- Activision expands to World’s Edge and Rare, and will develop the next Halo with a new, purpose-built team separate from ongoing Call of Duty plans. A small Halo Studios team stays on community support and in-market Halo games.
- Bethesda expands to Obsidian Entertainment, which continues current projects including Grounded plus a new Fallout collaboration with Bethesda Game Studios.
- King expands to Microsoft Casual Games.
- Playground Games and Turn 10 Studios merge into one studio focused on Forza and Fable.
Divestitures — Undead Labs, Ninja Theory, Arkane
August already saw Compulsion and Double Fine return to management with IP, catalogs, and runway funding. Undead Labs has now transitioned on similar terms; with a new publisher, State of Decay 3 is still planned as a day-one Game Pass release. Two separate buyer agreements for Ninja Theory fell through — Xbox is beginning consultation on a proposed closure while exploring other paths. Arkane consultation continues through end of 2026. Fate of further Hellblade / Senua work is not detailed in the memo.
Booty says he will spend time with studios over the next week, with an ALL-XBOX town hall on October 6.
