A new report indicates that Microsoft’s layoffs earlier this month have forced significant changes at its subsidiary 343 Industries, the company behind the Halo series of video games.
Bloomberg’s Jason Schreier wrote Tuesday that the layoffs have put Redmond, Wash.-based 343 into a position where it’s “all but starting from scratch.”
It was previously known that Microsoft’s recent round of layoffs had impacted several companies in its gaming department, including Bethesda Game Studios and ZeniMax Media, but not the extent to which each company was affected. IGN reported that 25% of 343 Industries’ staff had been let go.
The layoffs led to a round of rumors that 343 would transition into a role as a publisher, where it would farm out its development efforts on Halo to contractors. 343 studio head Pierre Hintze took to Twitter on Jan. 21 to address the rumors, claiming that the company “will continue to develop Halo now and in the future.”
Schreier alleges, based on leaked internal documents, that at least 95 developers were axed at 343 earlier this month. That would represent somewhere between 10% and 20% of the company’s employees.
GeekWire has reached out to Microsoft and 343 Industries for comment.
343’s last big game was Halo Infinite, which was a hit with critics and fans upon its launch for PC and Xbox in Dec. 2021. In the 13 months since its debut, however, Infinite repeatedly came under fire for its sluggish content release schedule, with major series features like cooperative campaign mode and the Forge map creator only showing up 11 months after Infinite’s debut.
Previously, 343 had described Halo Infinite as a “spiritual reboot” for the overall Halo franchise, as well as a platform that the company could continually build upon. By the original plan, there wouldn’t have been another new Halo game for years after Infinite‘s release; 343 would’ve just kept releasing content packs for Infinite.
Infinite‘s troubled development seems to have put 343 on the chopping block, however. After the layoffs, the company is reportedly shifting its overall direction with Halo. This reportedly includes moving on to a new game from Halo Infinite; employing outside contractors like Certain Affinity, which already contributed to work on Infinite; and switching from the internally-developed Slipspace engine to Epic’s Unreal.