Xbox Has Gone From 23 Studios To 12 In Five Years, And It's Still Not Done

Published Sep 23, 2026, 6:00 AM EDT Josh Coulson is an editor at TheGamer covering breaking news on everything from colorful platformers to the latest Lego sets. Primarily a news writer since 2018, Josh has covered just about every major game from the past decade. Now an editor, their focus has shifted to being the leading affiliate expert at the site, building relationships between TheGamer and global brands including Mattel, Funko, and The Pokemon Company. Xbox promised that it wasn’t done with its “reset” after its first round of layoffs earlier this year, and well, it wasn’t lying. Around 300 more Xbox employees lost their jobs this week in a move that focused on merging some of the studios that remain under the Xbox banner. That means there are now just 12 Xbox-owned studios left, almost half the total that resided under the platform’s banner five years ago. Xbox Has Almost Halved Its Studio Count In Five Years In 2021, 23 studios operated under the Xbox banner. After various departures, closures, and this week’s mergers, only 12 remain. It would have been even fewer than that too had Xbox not bought a studio between 2021 and now, completing its acquisition of Activision Blizzard in 2023 for close to $70 billion. Activision Blizzard is one of the 12 studios that remain under Xbox. One of the biggest updates from this week’s Xbox news is that Activision will develop the next Halo game. Halo Studios has survived closure, but barely, with most of its team laid off. It will be kept open to support the Halo community, whatever that might mean. Halo Studios came and went without developing a single original new Halo game. Rare has also survived, likely thanks to the ongoing success of Sea of Thieves, but will also now operate under Activision. Unlike Halo, there was no note on what that might mean for the studio’s future projects. The fear among Rare fans is that it will be turned into a Call of Duty support studio while also continuing to update Sea of Thieves. Mergers, Departures, And Closures Other mergers confirmed this week include Obsidian moving under Bethesda to continue work on its new Fallout game, and Turn 10 joining forces with Playground Games to help with future Forza and Fable titles. All moves that have continued to condense the number of studios under Xbox to almost half of where it was just half a decade ago. Most of those studios mentioned already are the lucky ones. The studios that, despite mass layoffs, still exist. Four of the 23 studios Xbox owned in 2021 have been shut down - Alpha Dog, Tango, The Initiative, and Arkane Austin. Tango was lucky enough to be revived and acquired by Krafton, and Alpha Dog has since returned as an indie studio. Other studios that have managed to make it out alive by regaining their independence include Double Fine, Compulsion Games, and Undead Labs. Senua studio Ninja Theory was hoping to do the same thing. However, after multiple deals have fallen through, it too now looks like it might be shut down, meaning that Xbox's total could be reduced to 11 relatively soon. Even some of the studios that remain Xbox-owned are shells of what they used to be. Halo Studios, which has been left with a skeleton crew, Doom developer id Software was hugely impacted by the prior round of layoffs, and Zenimax Online has also lost a lot of developers this year. That now leaves just 12 studios operating under Xbox, and that number might be even lower before the end of 2026. Not just because Ninja Theory can’t find a buyer and faces closure, but the future of Arkane Lyon remains up in the air, and Xbox has confirmed we are only 75% of the way through this process. Below are lists of the 12 studios that remain under Xbox, and the 11 that were in 2021 but have since merged with other studios, left Xbox, or been closed. Xbox-Owned Studios In 2026 Activision Blizzard Arkane Lyon Bethesda The Coalition Id Software inXile Entertainment MachineGames Mojang Studios Ninja Theory Playground Games World’s Edge Zenimax Online Studios That Have Merged, Closed, Or Left Since 2021 Alpha Dog Games (closed, now independent) Arkane Austin (closed) Compulsion Games (independent) Double Fine (independent) The Initiative (closed) Obsidian Entertainment (merged with Bethesda) Rare Games (merged with Activision Blizzard) Roundhouse Studios (merged with Zenimax Online) Tango Gameworks (closed and then acquired by Krafton) Undead Labs (independent) Brand Microsoft Original Release Date November 10, 2020 Original MSRP (USD) $499 Operating System Proprietary (Windows-based) Processor Custom AMD 8-core Zen 2 3.8 GHz Resolution 720p - 4K UHD