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Microsoft Gaming Chief Phil Spencer to Retire; Asha Sharma to Lead Xbox Into Next Phase

Prime Highlights

  • After a 38-year career, Phil Spencer will retire as head of Microsoft Gaming, ending a transformative era for the Xbox division marked by major acquisitions and platform integration.
  • Microsoft has appointed Asha Sharma as CEO of Microsoft Gaming, signaling a renewed focus on console gaming, AI-powered innovation, and long-term ecosystem growth.

Key Facts

  • Spencer, who led Xbox since 2014, oversaw major acquisitions including Activision Blizzard and Mojang, the studio behind Minecraft.
  • Microsoft Gaming revenue declined about 10% in the December quarter amid strong competition from Sony’s PlayStation and Nintendo’s Nintendo Switch, even as overall company sales grew.

Background

Microsoft has announced that its head of gaming, Phil Spencer, will retire after a 38-year career at the company, marking the end of one of the most influential tenures in the Xbox division. CEO Satya Nadella confirmed that succession planning had been underway for the past year and thanked Spencer for transforming Microsoft’s gaming strategy and culture.

Spencer, who took charge of Xbox in 2014, played a central role in expanding the business through acquisitions and platform integration. Under his leadership, Microsoft unified hardware, software, and game development teams and pushed major deals, including the purchase of Activision Blizzard and Minecraft maker Mojang.

Microsoft has appointed Asha Sharma as the new CEO of Microsoft Gaming. She will report directly to Nadella and take charge of the Xbox ecosystem. Sharma previously led product efforts in Microsoft’s Core AI unit and held senior roles at Instacart and Meta, bringing a mix of platform, commerce, and artificial intelligence experience to the position.

In her message to employees, Sharma reaffirmed Microsoft’s long-term commitment to console gaming, players, and developers. She said games would remain human-created art supported by advanced technology, while the company would use AI responsibly to improve tools and experiences rather than replace creativity.

The leadership change comes as Microsoft works to strengthen its gaming performance. Revenue in the unit declined about 10% in the December quarter, even as the company’s overall sales grew. The Xbox consoles face strong competition from Sony’s PlayStation and Nintendo’s Switch, prompting Microsoft to sharpen its strategy around content, cloud gaming, and platform innovation.

Studio head Matt Booty will report to Sharma as chief content officer, while Sarah Bond will leave the company after supporting the transition. Both Bond and Spencer will advise the new leader during the handover.

Microsoft said the new structure combines strong gaming expertise with consumer product leadership and positions Xbox for its next phase of growth, with renewed focus on players, creators, and long-term innovation.