Microsoft Gaming CEO Phil Spencer is retiring, Satya Nadella has announced. Asha Sharma, president of Microsoft’s CoreAI division, is taking over Spencer’s role, while current Xbox president Sarah Bond is stepping down.
“I have long been passionate about gaming and its role at the center of our consumer ambitions, and as we look ahead, I’m excited to share that Asha Sharma will become Executive Vice President and CEO of Microsoft Gaming,” says Nadella. “Over the past two years at Microsoft, and previously as Chief Operating Officer at Instacart and Vice President at Meta, Asha has helped build and scale services that reach billions of people and support thriving consumer and developer ecosystems. She brings deep experience in building and growing platforms, aligning business models with long-term value, and operating at a global scale, which will be critical in leading our gaming business into the next era of growth.”
In a thread on X, Spencer shared his thoughts on Sharma’s new situation. “I’m excited for it [Asha Sharma] As she steps into the CEO role,” Spencer wrote. “She’s joining an incredible group of people; The teams are full of talent, heart and a deep commitment to their players. Seeing him lean in with curiosity and a genuine desire to strengthen the foundation we’ve built gives me confidence that our Xbox communities will be well supported for years to come.
Along with Sharma, Matt Booty, the current head of Xbox Game Studios, is being promoted to chief content officer, and will report to Sharma. Sarah Bond, who like Spencer served as a public face for the Xbox brand and was considered his successor, is leaving Microsoft to “start a new chapter.” Bond has not yet made any public statement about his resignation.
Spencer joined Microsoft in 1988, and has been working on Xbox since at least 2001. He assumed responsibility for Microsoft’s gaming brand and its various studios and related subscription products in 2013, before becoming Executive Vice President of Gaming in 2017 and later CEO of Microsoft Gaming in 2022. Spencer’s biggest impact on Xbox will probably be remembered as Game Pass, Microsoft’s “Netflix for games,” and the creation of the wave of studios. Microsoft completed acquisitions from 2018 to 2022, including smaller studios like Double Fine and a massive $68.7 billion purchase of Activision Blizzard King.
While Microsoft has plenty of developers and IP to fall back on, it is struggling to compete with companies like Sony and Nintendo during the current console generation. Microsoft’s gaming division has gone through massive layoffs, saw its revenue continue to decline through 2025, and raised the prices of both its consoles and Game Pass Ultimate, which likely won’t help going forward. In many ways, Sharma has inherited a broken car.
As far as his plans are concerned, Sharma’s email to employees included in Nadella’s announcement is light on details. Sharma says she plans to continue developing “great games”, wants to “re-commit” to core Xbox fans and “invent new business models and new ways to play.” It remains to be seen whether this is enough to turn Xbox’s fortunes around.
Update, February 20, 4:52pm ET: Added statement from Phil Spencer shared on X.
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