A new AA studio has reportedly been set up within Blizzard.
That's according to a report by Windows Central, which said Microsoft and Activision had allegedly "approved the creation of a new team" within Blizzard mostly made up of employees from mobile developer King.
Sources told the publication that the new studio will work on AA games "based on existing franchises within the Blizzard universes", highlighting games such as World of Warcraft, Overwatch, and StarCraft.
It suggested that as the studio is comprised of former King employees, it's possible that it could be working on games for Xbox's mobile store which is set to launch this year.
The report also said that Microsoft is "keen to explore and experiment finding access out of smaller teams that are also integrated within the larger organisation" as a way of reducing cost.
Microsoft acquired Activision Blizzard in October 2023 after the deal was first announced in January 2022.
GamesIndustry.biz has reached out to Microsoft for further clarification.
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