What's happening to Xbox after new cuts: fewer studios, larger blocks

The September restructuring of Xbox turned out to be broader than just another staff reduction.Microsoft is simultaneously reducing its central structure, transferring major series to Activision and Bethesda, merging teams and removing some studios from direct ownership.If you put the confirmed solutions together, it becomes clearer what kind of Xbox the company is trying to build after the 2026 reset.

There are fewer independent independent studios

On September 22, Microsoft confirmed the reduction of another 268 positions.At the same time, Undead Labs is completing the transition to an independent model, while Double Fine and Compulsion Games previously chose a similar path.Ninja Theory is in a consultation process after unsuccessful attempts to find an option to keep the studio within a new structure.

Large publishing units become control centers

Activision is gaining a broader role around Halo, Rare and World's Edge, while Obsidian is moving under Bethesda's organizational wing.Playground Games and Turn 10 are teaming up.This does not mean that all brands change ownership: the internal management structure and distribution of teams changes.

We have already collected the main facts about the cuts and the transfer of Halo in the news "Xbox laid off 268 employees - the next Halo is being developed by Activision".The big picture here is more important: Microsoft is reducing the number of parallel management centers.

Game Pass remains the glue

Even studios that are leaving Xbox can maintain agreements to release games on Game Pass.State of Decay 3 remains in development, and the change in Undead Labs' corporate status does not equal the cancellation of the project.For Microsoft, this allows them to reduce fixed costs without necessarily losing out on future service content.

Xbox looks less and less like the old platform model

After the purchase of Bethesda and Activision Blizzard, the structure expanded for a long time through new teams.In 2026, the movement turned around: the company is now concentrating franchises in a few large blocks and increasingly using publishing agreements instead of direct ownership of each studio.

For players, the immediate test of this model is not the scheme on the organizational chart, but the quality and timing of specific games.Halo, Fallout, State of Decay 3, Fable and other projects should show whether centralization helps development or simply reduces the number of independent teams.