For nearly 25 years, Halo has been more than another intellectual property in Microsoft’s gaming portfolio. It was the game that helped sell the original Xbox, became one of the foundations of Xbox Live, survived Microsoft’s transition from Bungie to 343 Industries, and eventually grew into a franchise with more than 81 million games sold.
Now, for the first time in its history, responsibility for Halo’s next flagship instalment is moving somewhere entirely different.
Microsoft confirmed on September 22 that Activision will establish a new, purpose-built development team for the next major Halo game. The team will operate separately from Activision’s existing Call of Duty development structure, while a significantly smaller Halo Studios will remain responsible for supporting the Halo community and games already on the market.
The decision forms part of the massive Xbox restructuring announced on September 22, which also includes 268 job cuts, Obsidian moving under Bethesda’s remit, Rare and World’s Edge moving under Activision, and the consolidation of Playground Games and Turn 10 Studios.
For Halo, however, this is considerably more than a corporate reshuffle. Microsoft is entrusting the franchise that helped establish Xbox itself to an organisation that has spent decades building one of the industry’s most sophisticated systems for producing and supporting blockbuster first-person shooters.
Whether that production experience can work for Halo without stripping away what made the series distinctive may now become one of the defining questions surrounding the franchise’s next era.
Halo helped create Xbox?
When Halo: Combat Evolved arrived alongside the original Xbox in November 2001, Microsoft was attempting something extraordinarily difficult: entering a console market dominated by companies with established gaming identities. Halo became the product capable of giving Xbox one.
The commercial trajectory that followed explains why Microsoft’s latest decision carries so much weight. Halo: Combat Evolved and Halo 2 together sold roughly 15 million copies, while Microsoft’s figures for the Xbox 360 generation put combined sales of Halo 3, Halo Wars, Halo 3: ODST, Halo: Reach, Halo: Combat Evolved Anniversary and Halo 4 above 40 million copies.
Halo also became instrumental to Microsoft’s online ambitions. Halo 2 emerged as one of the defining experiences of the original Xbox Live service, while Halo 3 arrived in 2007 as a major entertainment event and cemented Master Chief as one of the most recognisable characters associated with console gaming. By 2021, Microsoft said the franchise had surpassed 81 million games sold worldwide and generated more than $6 billion in worldwide product sales. Even relatively late in that journey, Halo remained capable of producing enormous launches: Halo 5: Guardians generated more than $400 million in global game and hardware sales during its first week in 2015, with players logging 21 million hours during the same period.
This is the inheritance Activision is receiving. Not simply another shooter, but a franchise whose history is unusually intertwined with the platform that owns it.
From Bungie to 343 Industries and Halo Studios
There is another reason the Activision decision carries so much weight: Halo has already lived through one enormous developer transition.
Bungie created Halo’s original identity and developed the series through Halo: Reach after separating from Microsoft. Stewardship subsequently moved to 343 Industries, which went on to develop Halo 4, Halo 5: Guardians and Halo Infinite while also overseeing Halo: The Master Chief Collection and the broader franchise.
That stewardship entered another phase in 2024 when 343 Industries became Halo Studios and announced that future Halo development would move away from the proprietary Slipspace Engine towards Unreal Engine 5. In describing that transition, Halo Studios itself characterised the franchise as having gone through a Bungie chapter and a 343 Industries chapter before beginning another new era.
Halo Studios introduced Project Foundry as the technological foundation for that transition, using it to explore how Halo’s environments, characters and weapons could be rebuilt in Unreal Engine 5 while simultaneously changing the studio’s development processes.
That work eventually fed into Halo: Campaign Evolved, a rebuilt and expanded version of the original Combat Evolved campaign. The project is particularly significant because it also takes Halo beyond Xbox and PC for the first time, with a PlayStation 5 release forming part of Microsoft’s increasingly multiplatform strategy.
TalkEsport previously reported that Halo: Campaign Evolved on PS5 requires players to use a Microsoft account and Xbox Gamertag, with the same account infrastructure helping support cross-platform play and progression.
The franchise was therefore already undergoing a technological and platform reset before Microsoft’s September 2026 restructuring introduced an organisational one. Campaign Evolved remains part of Halo Studios’ existing work, but responsibility for the next flagship Halo title will move to Activision.
Why Activision makes sense for Halo
The immediate temptation is to interpret Microsoft’s decision as simply turning Halo over to the company behind Call of Duty. The reality is more nuanced.
Microsoft says Activision is creating a purpose-built Halo development team that will operate separately from its Call of Duty organisation. There is currently no basis for saying Infinity Ward, Treyarch or Sledgehammer Games themselves are developing the next Halo.
But separating the Halo team does not erase Activision’s institutional experience. Activision has spent years operating a network of studios capable of contributing to enormous projects simultaneously, with developers including Infinity Ward, Treyarch, Sledgehammer Games, Raven Software, Beenox, High Moon Studios and Demonware providing different forms of development and technological expertise.
That network has helped Activision solve a problem that has become increasingly difficult across AAA development: coordinating enormous teams while maintaining existing games, producing new content, operating online services and developing future releases at the same time.
Call of Duty provides the most obvious demonstration. Different lead studios have historically rotated between major releases while numerous supporting teams contribute engineering, art, multiplayer technology, online infrastructure and other development work.
Halo does not need to become Call of Duty for that experience to matter. What Activision can potentially bring is an established organisational framework for managing a blockbuster shooter across multiple development disciplines — something particularly relevant to a franchise expected to satisfy campaign players, competitive multiplayer audiences, cooperative players and an increasingly multiplatform Xbox strategy simultaneously.
Halo could fit Activision without becoming Call of Duty
The portfolio fit is more interesting than it initially appears. Activision already controls one of gaming’s dominant military shooter franchises in Call of Duty, but Halo occupies a distinctly different position.
Halo brings a science-fiction universe, arena-influenced multiplayer, large combat spaces, vehicles, cooperative campaigns and a highly recognisable collection of weapons, enemies and environments. Its combat rhythm, built around rechargeable shields, weapon combinations, grenades, vehicles and intelligent enemy encounters, has historically separated it from the faster military-shooter structure associated with Call of Duty.
That distinction gives Activision an opportunity to expand its shooter portfolio without simply producing another product aimed at the same experience. Call of Duty can remain Call of Duty while Halo occupies a science-fiction and sandbox-oriented position with a fundamentally different tone and style of play.
Halo also arrives at Activision at a moment when Microsoft’s gaming strategy extends well beyond Xbox hardware. The company’s ownership of Activision Blizzard King gives it major businesses across console, PC and mobile, while Halo itself has now begun expanding to PlayStation.
That makes the next Halo potentially much broader than a traditional Xbox exclusive. Activision’s experience launching and operating games across multiple platforms could become increasingly relevant if Microsoft’s multiplatform approach continues into Halo’s next flagship release.
The risk is making Halo efficient but less like Halo
The same factors that make Activision an intriguing choice also create the most obvious concern.
Halo’s popularity was never built purely on the fact that it was a first-person shooter. Its identity emerged from the interaction between open combat spaces, enemy AI, vehicles, physics, rechargeable shields, distinctive weapons, cooperative play and encounters that could unfold differently depending on how players approached them.
Its multiplayer developed a similarly recognisable language around weapon control, map positioning, shields and power items rather than simply following the conventions of military shooters.
Activision’s experience can potentially help Microsoft deliver Halo more consistently, but production efficiency alone does not guarantee a successful Halo game. The new team will still need developers who understand why a Halo encounter feels like Halo, why a Warthog behaves differently from an ordinary shooter vehicle, why Covenant enemy combinations matter and why apparently small changes to movement, weapons or map design can generate enormous reactions from a community that has been playing these games for decades.
That may also explain why Microsoft is creating a dedicated Halo team rather than simply assigning the franchise to an existing Call of Duty developer. Activision provides the organisational home and production infrastructure; the new team still has to preserve Halo’s identity.
Activision is inheriting a franchise that still matters
The scale of Halo’s history makes the next step particularly consequential. More than 81 million games had been sold by 2021, worldwide product sales had exceeded $6 billion, and the series had already helped Microsoft establish multiple generations of Xbox hardware while expanding into books, merchandise, television and other media.
Halo therefore does not need to prove that audiences can care about Halo. The challenge is demonstrating that another development organisation can produce a new entry capable of becoming culturally significant rather than merely sustaining a famous intellectual property.
Activision has considerable experience managing enormous shooter franchises, a worldwide network of specialised studios and an organisational structure designed around producing and supporting games at a scale few publishers can match. Halo brings an established universe, one of gaming’s most recognisable protagonists and a fanbase accumulated across a quarter of a century.
Microsoft’s decision effectively puts those two assets together.
The experiment will be whether Activision can give Halo the production consistency of a modern blockbuster franchise without turning Halo into something it was never supposed to be.
After 25 years of Master Chief being developed first by Bungie and then by 343 Industries and Halo Studios, the next major Halo is consequently much more than another sequel. It will be the first real test of whether Microsoft’s largest-ever gaming acquisition can help shape the next era of the franchise that originally helped make Xbox matter.
