Phil Spencer retires from Xbox with CoreAI exec Asha Sharma taking over as Microsoft Gaming CEO
A major shakeup is taking place at the top of Microsoft’s gaming business, as long-time Xbox and Microsoft Gaming boss Phil Spencer is retiring, effective from Monday 23rd February, with current President of Microsoft’s CoreAI, Asha Sharma is set to take over as the new CEO of Microsoft Gaming.
Xbox President Sarah Bond, who was easy to view as Spencer’s eventual successor, has resigned, while Xbox Game Studios head Matt Booty is being promoted to Chief Content Officer.
Messages from all (except Bond) have been published by Microsoft. Spencer said that he had been thinking about retiring for a little while, and that this handover has seen him work with his successor for several months now.
“Last fall, I shared with Satya that I was thinking about stepping back and starting the next chapter of my life. From that moment, we aligned on approaching this transition with intention, ensuring stability, and strengthening the foundation we’ve built. Xbox has always been more than a business. It’s a vibrant community of players, creators, and teams who care deeply about what we build and how we build it. And it deserves a thoughtful, deliberate plan for the road ahead.
“Today marks an exciting new chapter for Microsoft Gaming as Asha Sharma steps into the role of CEO, and I want to be the first to welcome her to this incredible team. Working with her over the past several months has given me tremendous confidence. She brings genuine curiosity, clarity and a deep commitment to understanding players, creators, and the decisions that shape our future. We know this is an important moment for our fans, partners, and team, and we’re committed to getting it right. I’ll remain in an advisory role through the summer to support a smooth handoff.”
Sharma might not have been the most obvious choice from the outside, and coming from an AI background will certainly be a cause for concern to many gamers, where generative AI is viewed very negatively.
“My first job is simple: understand what makes this work and protect it. That starts with three commitments. First, great games. Everything begins here. We must have great games beloved by players before we do anything. Unforgettable characters, stories that make us feel, innovative game play, and creative excellence. We will empower our studios, invest in iconic franchises, and back bold new ideas. We will take risks. We will enter new categories and markets where we can add real value, grounded in what players care about most. I promoted Matt Booty in honor of this commitment. He understands the craft and the challenges of building great games, has led teams that deliver award-winning work, and has earned the trust of game developers across the industry.
“Second, the return of Xbox. We will recommit to our core Xbox fans and players, those who have invested with us for the past 25 years, and to the developers who build the expansive universes and experiences that are embraced by players across the world. We will celebrate our roots with a renewed commitment to Xbox starting with console which has shaped who we are. It connects us to the players and fans who invest in Xbox, and to the developers who build ambitious experiences for it.
“Gaming now lives across devices, not within the limits of any single piece of hardware. As we expand across PC, mobile, and cloud, Xbox should feel seamless, instant, and worthy of the communities we serve. We will break down barriers so developers can build once and reach players everywhere without compromise.
“Third, future of play. We are witnessing the reinvention of play. To meet the moment, we will invent new business models and new ways to play by leaning into what we already have: iconic teams, characters, and worlds that people love. But we will not treat those worlds as static IP to milk and monetize. We will build a shared platform and tools that empower developers and players to create and share their own stories.
“As monetization and AI evolve and influence this future, we will not chase short-term efficiency or flood our ecosystem with soulless AI slop. Games are and always will be art, crafted by humans, and created with the most innovative technology provided by us.”
There’s definitely some reassuring sentiments within that, though I would argue that saying your first job is to understand what’s going on makes this sound more of a hurried appointment. We will have to see how much institutional change follows.
Phil Spencer had been at the helm of Microsoft’s gaming efforts for over a decade, taking over in 2014 and setting about steading the suddenly floundering console gaming business. He moved quickly to cut the price of the Xbox One by removing the Kinect from the bundle, made gamer-positive moves like championing backwards compatibility, and enacted major changes to the Xbox business model by promising day-and-date PC releases for Xbox games (and releasing them on Steam), as well as introducing Xbox Game Pass. He also saw Xbox exclusives start to come to PlayStation, breaking down traditional barriers.
However, he’s also been at the helm more recent difficult times for the brand. The Xbox Series X|S launch did not go as successfully as planned, not least with significant game delays for the likes of Halo Infinite, studio acquisitions took a long time to bear fruit, Xbox Game Pass started to see market saturation, and then successive price increases to both consoles and services.
With an eye to the future, now might be the best time for him to step aside, but Xbox as a brand feels somewhat nebulous right now. There’s a lot of rumours about what their next console might be like, whether it’s more PC-like than console and with rival storefronts, or traditional. Microsoft will inevitably be very keen to see AI used in some fashion, having demoed AI helpers with Minecraft in recent years (and that was before the current madness). But with a new CEO all of that could change. We’ll have to wait and see.
Source: Microsoft
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