Xbox layoffs and studio mergers reportedly coming this week

Xbox is preparing layoffs and studio consolidation moves this week, according to multiple reports cited by Polygon. Xbox CEO Asha Sharma is expected to announce the restructuring, which includes folding several first-party studios under larger umbrellas and cutting an unspecified number of jobs.

The biggest rumored change: Halo development may move from 343 Industries to oversight by Activision Blizzard. That would mark a major shift for Microsoft's flagship franchise, though the reports don't specify whether 343 itself would be absorbed or remain as a smaller support team. No timeline for the next Halo game has been confirmed.

This follows Microsoft's 2023–2024 wave of cuts, which hit nearly 2,000 employees across Xbox Game Studios and Activision Blizzard after the $69 billion acquisition closed. The company has framed these moves as "efficiency" measures, but the pattern is consistent: acquire studios, consolidate teams, cut headcount.

For PC gamers, the practical impact depends on whether the shake-up delays announced games or shifts support priorities. Halo Infinite on PC has already seen uneven post-launch support — a leadership change could mean another reset. If you're banking on Game Pass staying flush with day-one releases, watch whether the cuts affect production schedules. Check BetterFPS to see if your current rig still hits your targets while you wait for the next wave of announcements.