Valve isn't working on Half-Life 3 because of the Steam Deck
The sequel to Half-Life 2: Episode 2 is undoubtedly one of the most anticipated games, right up there with GTA VI and Star Citizen. It is hard to determine if it will arrive in the form of Half-Life 2: Episode 3 or Half-Life 3 or, at this point, even see the light of day. Those expecting to see it in the coming years are in for a bit of a disappointment, as Valve doesn't have a team working on any Half-Life game at the moment.
The information comes from YouTuber Tyler McVicker (via VGC), who states that Valve has a 'minor' group of people working on Half-Life 3. Most of Valve's resources are directed towards pushing out the already-delayed Steam Deck, which is slated to launch later next year. Additionally, Valve seems to be more interested in a mystery project called Citadel. It is essentially a cooperative first-person shooter that incorporates elements of Left 4 Dead and Half-Life. Citadel is expected to launch sometime in the next two years if things go smoothly.
Now, it is entirely possible that Valve could shift focus back to Half-Life 3 once the Steam Deck is out and about. However, the team will have to rewrite the game's story from the ground up, as former Half-Life story writer Marc Laidlaw kind of spoiled its plot a few years ago. Thankfully the cliff-hanger left at the end of Half-Life: Alyx suggests that Valve doesn't want to give up on its most beloved franchise just yet.