Xbox head Phil Spencer is leaving Microsoft

Phil Spencer, CEO of Microsoft Gaming, is retiring, Satya Nadella has announced. Asha Sharma, the President of Microsoft’s CoreAI division is taking on Spencer’s position, whereas Sarah Bond, the present President of Xbox, is resigning.

“I’m lengthy on gaming and its position on the middle of our shopper ambition, and as we glance forward, I’m excited to share that Asha Sharma will change into Govt Vice President and CEO, Microsoft Gaming, reporting to me,” Nadella says. “Over the past two years at Microsoft, and beforehand as Chief Working Officer at Instacart and a Vice President at Meta, Asha has helped construct and scale providers that attain billions of individuals and assist thriving shopper and developer ecosystems. She brings deep expertise constructing and rising platforms, aligning enterprise fashions to long-term worth, and working at international scale, which might be vital in main our gaming enterprise into its subsequent period of progress.”

In a thread on X, Spencer shared his ideas on Sharma’s new place. “I’m excited for [Asha Sharma] as she steps into the CEO position,” Spencer wrote. “She’s becoming a member of an unimaginable group of individuals; groups filled with expertise, coronary heart, and a deep dedication to the gamers they serve. Watching her lean in with curiosity and an actual need to strengthen the inspiration we have constructed offers me confidence that our Xbox communities might be nicely supported within the years forward.”

Alongside Sharma, Matt Booty, the present head of Xbox Recreation Studios, is getting promoted to Chief Content material Officer, and can report back to Sharma. Sarah Bond, who like Spencer served as a public face for the Xbox model and was assumed to be his successor, is leaving Microsoft to “start a brand new chapter.” Bond has but to make a public assertion about her resignation.

Spencer joined Microsoft in 1988, and has labored on Xbox since at the very least 2001. He assumed accountability for Microsoft’s gaming model and its varied studios and related subscription merchandise in 2013, earlier than turning into an Govt VP of Gaming in 2017 and later CEO of Microsoft Gaming in 2022. Spencer’s greatest impression on Xbox will probably be remembered because the creation of Game Pass, Microsoft’s “Netflix for Video games” and the wave of studio acquisitions Microsoft accomplished from 2018 to 2022, which included smaller studios like Double Fine and the large $68.7 billion purchase of Activision Blizzard King.

Whereas Microsoft has loads of builders and IP to fall again on, it is struggled to compete with the likes of Sony and Nintendo in the course of the present console era. Microsoft’s gaming division has gone by way of widespread layoffs, its income continued to fall all through 2025 and it raised the costs of both its consoles and Game Pass Ultimate, which probably will not assist issues going ahead. Sharma is in some ways inheriting a broken-down car.

So far as her plans go, Sharma’s e-mail to workers that was included in Nadella’s announcement is gentle on particulars. Sharma says she plans to proceed growing “nice video games,” desires to “recommit” to core Xbox followers and “invent new enterprise fashions and new methods to play.” Whether or not that’s sufficient to show Xbox’s fortunes round stays to be seen.

Replace, February 20, 4:52PM ET: Added assertion from Phil Spencer shared on X.