Xbox Hands Halo to Call of Duty Studio Activision

Microsoft is tapping Call of Duty publisher Activision to build the next mainline Halo game, while Halo Studios winds down and sheds staff.

Did you ever think you'd see the day when the studio behind Call of Duty would be the one making Halo? That's exactly what's happening, and it's a big shakeup for Xbox.

Microsoft is overhauling its Xbox business in a major and painful way, and part of the plan is handing the next mainline Halo game to Activision, the publisher behind Call of Duty. This isn't a spin-off or a side project, it's the next proper entry in the series following 2021's Halo Infinite, which left plenty of fans disappointed.

So what do we actually know? Xbox chief content officer Matt Booty didn't share specifics, but The Hollywood Reporter says it's a "full-feature, mainline installment." Activision boss Rob Kostich told Game File the team wants to make the "greatest Halo game ever," one "worthy of its universe and legacy, while staying true to what made players love it in the first place." He said Activision has already started assembling a purpose-built team for the job.

Booty also made it clear this effort is separate from Call of Duty's ongoing development and plans. Despite years of speculation that a CoD studio would get handed Halo, a brand-new team is being spun up instead. Whether that affects Call of Duty's annual release rhythm or pulls key people away from CoD remains to be seen.

Don't expect to play it anytime soon. Given that the team is still being assembled, it's extremely early days. Xbox has shown it's fine with announcing games years out, like Blizzard's StarCraft shooter targeting 2030 and Bethesda's Elder Scrolls 6, revealed back in 2018.

Meanwhile, Halo Studios is winding down significantly. According to Booty, only a "small team" will stay on to support the Halo community and games already in market, with numerous staffers losing their jobs. Back in October 2024, Microsoft renamed 343 to Halo Studios and outlined plans for multiple new games, including a switch to Unreal Engine. Halo Studios' only release under that name, Halo: Campaign Evolved, arrived in July 2026 and was reportedly a commercial disappointment, with fans also puzzled that the first-game remake had no multiplayer.

It now looks like Halo Studios' in-development projects, said to include a Fortnite-like live-service game and Halo 2 and Halo 3 remakes, are dead. The Unreal Engine plans could be over too, since Activision's Call of Duty games run on proprietary engines. A Microsoft spokesperson declined to comment on Halo Studios' future. Xbox CEO Asha Sharma has said Halo remains "very key" to Xbox and that more news is coming, but Halo co-creator Marcus Lehto has doubts, estimating a fully featured Halo could cost $600 to $800 million and take four or more years. After the Activision news, he said he was "shocked but not entirely surprised."

What do you think, can Activision pull off the greatest Halo ever, or is this a gamble too far? Let us know in the comments.