Xbox CEO Phil Spencer retires after 38 years at Microsoft; Asha Sharma appointed new CEO of games
Phil Spencer, the head of Xbox who spent 38 years at Microsoft and helped reshape the gaming industry with big purchases and bets on cloud gaming, is retiring from the company.
He will be succeeded as CEO of Microsoft Gaming by Asha Sharma, a former Instacart CEO and Meta vice president who joined Microsoft two years ago, the company said on Friday.
The changes include the departure of Sarah Bond, the Xbox president who was widely seen as a potential replacement for Spencer, and the promotion of Matt Booty to senior vice president and chief content officer overseeing Microsoft’s nearly 40 game studios.
In an email to employees, Spencer said he told Microsoft CEO Satya Nadella last fall that he was ready to step down, and that they had been planning changes ever since. He called his nearly four decades at Microsoft “an epic journey and the privilege of a lifetime.”
Spencer “expanded our reach across PC, mobile, and cloud; nearly tripled the size of the business; helped shape our strategy with the acquisitions of Activision Blizzard, ZeniMax, and Minecraft; and strengthened our culture across our studios and platforms,” Nadella wrote in a separate letter.
The longtime Xbox leader will remain in an advisory role over the summer to support the handoff. Bond is also expected to remain at the company during the transition.
Sharma, who is now president of Microsoft’s CoreAI product organization, has roots in the Seattle community, has extensive experience in consumer platforms and operations, and has no prior experience in the video game industry.
That’s where Booty’s new role will come in – as chief content officer, the industry veteran will oversee Microsoft’s studio portfolio, combining his decades of gaming experience with Sharma’s background.
In his first message to the games team, Sharma promised to recommit himself to fans of Xbox’s core console and vowed that the company would not “flood our ecosystem with soulless AI slop,” calling games “art, created by humans.”
Microsoft had planned to make an announcement next week, but accelerated its timeline after IGN learned of the plans from inside sources. Sports publishing has made headlines a short time ago.
Xbox is facing the storms of change.
Gaming revenue fell 9%, or $623 million, during Microsoft’s latest quarter, while Xbox and services revenue fell 5% and hardware revenue fell 32%. CFO Amy Hood of Microsoft pointed out that the decline is half of the quarter of the previous year that benefited from the strong release of first-party games.
The business accounts for just over 7% of Microsoft’s total revenue — about $5.96 billion of the $81.3 billion in the most recent quarter — but remains central to the tech giant’s consumer aspirations.
