Bloomberg says that Microsoft’s recent layoffs cost Halo developer 343 Industries at least 95 employees, and that the studio is transferring from its proprietary Slipspace engine to Epic Titles’ widely used Unreal Engine for future games.

Since the announcement of layoffs on January 18, Halo’s future has been rather uncertain. Late in 2021, Halo Infinite had a strong launch, but over time, fans grew irritated by frustrations with multiplayer progression, delays to planned features such as network campaign co-op and Forge (which finally launched in November), and a lack of indication that new campaign content was forthcoming.

Following the layoffs, 343 has officially reaffirmed its dedication to the franchise. “Halo and Master Chief are here to stay,” studio head Pierre Hintze, who assumed the position in September, tweeted on January 21st from the Halo account. “343 Industries will continue to create Halo, including epic stories, multiplayer, and more of what makes Halo great, both now and in the future.” In an interview with Bloomberg, Matt Booty, CEO of Xbox Game Studios, stated that “343 will continue as the internal developer for Halo and the home of Halo.”

However, it is unknown when the next game in the series will be released, making it difficult to predict 343’s future involvement with the franchise. For instance, the company was already collaborating with Austin-based Certain Affinity on a battle royale game dubbed Tatanka, although Bloomberg writes that the game “may evolve in numerous directions.”

Tatanka will reportedly be developed using Unreal Engine, and future Halo games “will also investigate using” Unreal, according to Bloomberg. If true, this is yet another major game developer moving to Unreal; in March, CD Projekt Red, developer of The Witcher and Cyberpunk, announced a “multi-year strategic partnership” with Epic Games to use Unreal, and in November, Epic stated that more than half of the announced next-generation games are built on Unreal Engine.

Also, it appears like 343 has not been creating new story content for Halo Infinite, which is remarkable for a game that was previously marketed as the “beginning of the next decade of Halo” and titled, well, Infinite. Bloomberg reports that instead, developers were “creating Unreal Engine prototypes and presenting ideas for new Halo games.” I was personally dismayed to learn this, as I had thoroughly loved Infinite’s campaign and hoped for more.

We’ve requested that Microsoft comment on the Bloomberg report. Epic declined to comment.

Bloomberg claimed on the day of the layoffs that Joe Staten, who Microsoft hired to assist with the development of Infinite, will return to Xbox’s publishing group.

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