343 is reportedly 'starting from scratch' on Halo development after layoffs

A switch to the Unreal Engine may be part of the strategy.

343 Industries/Microsoft

343 Industries and Halo may be here to stay despite Microsoft's mass layoffs, but that doesn't mean it's business as usual for the franchise. Bloomberg sources claim 343 is effectively restarting Halo development between multiple changes that include the loss of "at least" 95 jobs, including directors and key contractors. Notably, the studio is reportedly switching to Epic's Unreal Engine after both a leadership shuffle and struggling with its aging in-house platform (Slipspace) — it's even breaking from its familiar story-driven gameplay, according to the tipsters.

The 343 team is understood to be using Unreal for an unannounced game, nicknamed "Tatanka," developed with the help of long-time ally Certain Affinity. It was originally built as a battle royale title but might "evolve" into other forms, the sources say. While some at 343 are supposedly worried Unreal might affect how Halo feels to play, Slipspace's glitches and hard-to-use tech have apparently held back multiplayer features in Halo Infinite that include past favorites like Assault and Extraction.

Many of the laid off workers were crafting game prototypes in Unreal rather than producing new missions for Halo Infinite, Bloomberg says. 343 had considered switching engines for the past decade, the insiders claim, but it wasn't until studio lead Bonnie Ross and engine overseer David Berger left in late 2022 that the company committed to the change. Pierre Hintze, who replaced Ross, is said to have focused the company on "greenlighting" new tech while expanding Infinite.

Microsoft has declined to comment. A revamped strategy wouldn't be surprising even without layoffs. While Infinite was well-received on launch, delayed modes, seasons and even a cancelled split-screen mode haven't helped its reputation. 343 has also played a role in some of the Halo series' less-than-stellar projects, including the problematic Halo: Master Chief Collection and offshoots like Halo Wars 2. A fresh start isn't guaranteed to reinvigorate the sci-fi shooter, but it may address lingering concerns.