Halo Studios morale sinks following Xbox lay-offs with devs unhappy with “the quality” of upcoming Combat Evolved Remake

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In the past few days, Microsoft and Xbox have seen significant job cuts, impacting over 9,000 employees. This decision has also led to the cancellation of projects like Everwild, Perfect Dark, and an unnamed MMO. Additionally, though not as severely affected by layoffs, some developers from Halo Studios have been let go, including a UI artist and a Quality Assurance manager.

Right now, Halo Studios is developing a remake of Halo: Combat Evolved, which has yet to be officially announced, and is planned for launch on both PC and Xbox platforms in 2026 to celebrate the game’s 25th anniversary. It appears, though, that the project isn’t going quite as well as the team had anticipated.

According to an article on Engadget, a staff member at Halo Studios shared insights about the recent job cuts at Microsoft and Xbox. This employee referred to a memo written by Phil Spencer, CEO of Microsoft Gaming, in which he acknowledged that Microsoft Gaming is thriving, yet these 9,000 layoffs are intended to boost the company’s adaptability and efficiency.

A Halo Studios developer expressed their frustration, saying, “I find it hard to feel pleased when Phil boasted about this being the most lucrative year for Xbox while also making such a decision.” They added, “I was unsure which aspect of that message I was expected to celebrate.

Regarding the ongoing work on Halo Studios’ supposed Combat Evolved Remake, the same team admitted that its progress has been challenging. This forthcoming project, which faced difficulties recently, is set to be unveiled during this year’s Halo World Championship in October. However, it’s important to note that the team has experienced layoffs in 2023 and 2024, contributing to its past struggles.

In approximately 18 months before its launch, Halo Studios still has some leeway for improvement. However, following Microsoft’s past layoffs that affected the campaign and storyline teams, there is an extensive amount of tasks that need attention.

The developer went on to express that everyone seems dissatisfied with the current state of the product,” he said. “There’s been a good deal of stress, as well as efforts to motivate people to release it.

One challenge faced during Halo Infinite’s development was Microsoft’s reliance on external contract workers to help build the game, which clashed with the game’s proprietary Slipspace Engine. Now, moving to Unreal Engine 5 is expected to simplify contract work, but Microsoft has opted for a different approach instead.

As reported by the developer, Microsoft has shifted its strategy for creating Halo games, opting to collaborate with contracted studios as opposed to individual employees. This approach was also utilized in the recently cancelled Perfect Dark project, where Crystal Dynamics, known for their work on Tomb Raider, contributed to the development process.

As a gamer myself, I’ve got to admit that the gaming landscape seems to be leaping forward at a pace that leaves Xbox development feeling like it’s stuck in the past. It’s frustrating because it means a lot of my creative energy gets wasted, and it feels like we’re constantly playing catch-up.

Moreover, it’s been rumored that Microsoft is pushing hard to automate as many jobs as possible with AI agents. This shift towards automation has even seeped into other areas within the company.

Over the recent years, Microsoft’s layoffs have had a detrimental impact on the Halo series in various aspects. The post-release updates for both multiplayer and single-player expansions of Halo Infinite have been compromised, delaying cross-media projects, and slowing down the progress of the upcoming Halo Combat Evolved remake.

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2025-07-03 15:10