Phil Spencer, CEO of Microsoft Gaming, is retiring, Satya Nadella has announced. Asha Sharma, the President of Microsoft’s CoreAI division is taking over Spencer’s role, while Sarah Bond, the current President of Xbox, is resigning.
“I am long on gaming and its role at the center of our consumer ambition, and as we look ahead, I’m excited to share that Asha Sharma will become Executive Vice President and CEO, Microsoft Gaming, reporting to me,” Nadella says. “Over the last two years at Microsoft, and previously as Chief Operating Officer at Instacart and a 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 building and growing platforms, aligning business models to long-term value, and operating at global scale, which will be critical in leading our gaming business into its next era of growth.”
In a thread on X, Spencer shared his thoughts on Sharma’s new position. “I’m excited for [Asha Sharma] as she steps into the CEO role,” Spencer wrote. “She’s joining an incredible group of people; teams full of talent, heart, and a deep commitment to the players they serve. Watching her lean in with curiosity and a real desire to strengthen the foundation we’ve built gives me confidence that our Xbox communities will be well supported in the years ahead.”
Alongside Sharma, Matt Booty, the current head of Xbox Game Studios, is getting 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 assumed to be his successor, is leaving Microsoft to “begin a new chapter.” Bond has yet to make a public statement about her resignation.
Spencer joined Microsoft in 1988, and has worked on Xbox since at least 2001. He assumed responsibility for Microsoft’s gaming brand and its various studios and associated subscription products in 2013, before becoming an Executive VP of Gaming in 2017 and later CEO of Microsoft Gaming in 2022. Spencer’s biggest impact on Xbox will likely be remembered as the creation of Game Pass, Microsoft’s “Netflix for Games” and the wave of studio acquisitions Microsoft completed from 2018 to 2022, which included smaller studios like Double Fine and the massive $68.7 billion purchase of Activision Blizzard King.
While Microsoft has plenty of developers and IP to fall back on, it’s struggled to compete with the likes of Sony and Nintendo during the current console generation. Microsoft’s gaming division has gone through widespread layoffs, its revenue continued to fall throughout 2025 and it raised the prices of both its consoles and Game Pass Ultimate, which likely won’t help things going forward. Sharma is in many ways inheriting a broken-down car.
As far as her plans go, Sharma’s email to staff that was included in Nadella’s announcement is light on details. Sharma says she plans to continue developing “great games,” wants to “recommit” to core Xbox fans and “invent new business models and new ways to play.” Whether that’s enough to turn Xbox’s fortunes around remains to be seen.
Update, February 20, 4:52PM ET: Added statement from Phil Spencer shared on X.
Microsoft could launch the next-generation Xbox console sometime in 2027, AMD CEO Lisa Su has revealed during the semiconductor company’s latest earnings call. Valve is on track to start shipping its AMD-powered Steam Machine early this year, she said, while Microsoft’s development of an Xbox with a semi-custom SOC from AMD is “progressing well to support a launch in 2027.” While it doesn’t necessarily mean Microsoft is releasing a new Xbox console next year, that seems to be the company’s current goal.
Xbox president Sarah Bond announced Microsoft’s multi-year partnership with AMD for its consoles in mid-2025. Based on Bond’s statement back then, Microsoft is embracing the use of artificial intelligence and machine learning in future Xbox games. She also said that the companies are going to “co-engineer silicon” across devices, “in your living room and in your hands,” implying the development of future handheld consoles.
Leaked documents from the FTC vs. Microsoft court battle revealed in the past that Microsoft was planning to make the next Xbox a “hybrid game platform,” which combines local hardware and cloud computing. The documents also said that Microsoft was planning to release the next Xbox in 2028. Whether the company has chosen to launch the new Xbox early remains to be seen, but it is possible when the Xbox X and S were released in 2020, and they haven’t sold as well as the Xbox One.
Xbox‘s new handheld device has been out for 24 hours and the response to the ROG Xbox Ally and pricier ROG Xbox Ally X has been overwhelmingly positive from early reviewers.
But as with every major release within the gaming community, the Ally’s launch has prompted questions surrounding cost vs. value, who exactly the handheld console is meant for, and how the new on-the-go-PC-style product (made in partnership with Taiwanese electronics company Asus) might impact Microsoft Gaming’s plans for more full-scale Xbox gaming consoles.
First up, Xbox president Sarah Bond tells Variety that the price tags for the Ally ($599.99) and Ally X ($999.99) were largely determined by manufacturer Asus.
“We looked at, how do we create multiple options for people? And it really was Asus, because this is their hardware,” Bond said Thursday during a launch event for the Ally devices. “That is all of their insight into the market, into the feature set, into what people want, to determine the ultimate prices of the devices.”
Despite the steep price, Bond says that when pre-orders opened on September, “the reaction was overwhelming demand for the device.” “We sold out on the Xbox Store. We sold really quickly at a number of other places around the world,” Bond said. “I feel really good about the value that we’re giving gamers for the price, based off the reception to the hardware.”
Courtesy of Microsoft
Bond says the pre-launch results are “a real confirmation of something that we know and have been working towards for a really long time, which is gaming should act like all entertainment: it should be something you can have with you anywhere. You should be able to play any game you want with anyone you want on any device.”
Xbox decided to partner with Asus to develop the Ally line of handhelds “to really begin to transform the experience and take it to that next level in a way that we could do partnered much quicker, and in a much more innovative way, than we could [individually] with what we were each doing,” Bond says.
The first step in the process was prioritizing the ergonomic design of the Ally and Ally X: “We took everything we knew about what it took to make a controller, what it actually feels like for things to work in a variety of hand sizes, what it feels like to play for three hours and worked on the ergonomics of the device to make it super, super comfortable,” the Xbox president said.
Once the hands-on experience was sorted, Bond says the Xbox team’s next call was to Microsoft’s PC department.
“We partnered with the Windows team to think about the Windows experience on the device and to make sure it was optimized,” Bond said. “There isn’t a keyboard on this. We had to optimize it for controller and touch all the way through the UE, all the way through jumping into your games. So Windows is actually built to run on a handheld and on this form factor and on something that is built especially for a gaming.”
Some early discourse around the Xbox handhelds is questioning who exactly the products are meant for, seeing as Asus is first and foremost focused on PC-handheld devices, and there are skeptics who think the ROG Xbox Ally was going to be little more than an existing Asus product with an Xbox button and branding.
While not an internally made product, Bond insists it is Xbox through and through — whether you’re a more causal gamer and want an Ally, or a hardcore gamer who is eyeing an Ally X.
“We want to make sure that people have a choice,” Bond says. “We want to make sure there’s an option for the power players who want the latest innovations, that want to push the edge of what’s possible, the most demanding players. And then, if someone is looking for PC gaming on the go, they’re a casual gamer, they’re a gaming enthusiast, then there’s Xbox Allys for them. Giving multiple choices for people, so we can actually meet people where they are.”
The announcement of the ROG Xbox Allys and Xbox’s partnership with Asus also sparked some confusion over whether Xbox was out of the in-house-made console game. Bond confirms the Xbox team is still hard at work on its next-gen consoles, the follow-ups to the Xbox Series S and X, and there’s even the possibility of internally made handhelds.
“We are 100% looking at making things in the future,” Bond said. “We have our next-gen hardware in development. We’ve been looking at prototyping, designing. We have a partnership we’ve announced with AMD around it, so that is coming. What we saw here was an opportunity to innovate in a new way and to bring gamers another choice, in addition to our next-gen hardware. We are always listening to what players and creators want. When there is demand for innovation, we’re going to build it.”
The launch of the Xbox Ally and Ally X comes on the heels of several price increases at Xbox (for both consoles and its Game Pass subscription service) and just before the holiday season, when Xbox has a slate of much-anticipated AAA game launches still to come, including “Call of Duty: Black Ops 7” and “Outer Worlds 2.” Bond notes this frenzy of releases and business updates are “the start of a new pace the team is executing.”
“There’s a ton more innovation to come, including things like further optimizing the experience here, scaling out the handheld compatibility program, offering more benefits and improvements to the experience and other features and adds that we’re going to give to people and more choices and more games,” Bond says.
A Call of Duty: Black Ops 6 campaign that looks like Mission: Impossible by way of an Adam Curtis documentary, a Gearsof War prequel that shows fans E-Day and the birth of the series’ iconic “Lancer” chainsaw gun, and a trailer that showed Perfect Dark isn’t just still alive, it’s potentially thriving. Microsoft’s 2024 summer showcase was the best that Xbox has looked going back to the Xbox One years. But it’s come at a huge price, and one the company doesn’t seem ready to acknowledge publicly.
Thank You, PS Plus, For Making My Backlog Even Bigger
Insiders had been hyping the showcase for days, in part due to the fact that its full list of reveals and announcements had already leaked to some in the media and beyond. Fans have been burned before, expecting Xbox to finally turn a corner only to have the football pulled once again and realize the platform is still in another one of its inescapable “rebuilding” years. The proof is always in the games themselves, and how successful they are can only really be determined once they get into players’ hands. For now, though, the showcase delivered.
There was over sixty minutes of games big and small, offering everything from zombie survival to nostalgic teen hangout, punctuated by massive first-party franchises and third-party teases. If you own an Xbox Series X/S there will be plenty to play this year and next. Xbox game studios head Matt Booty’s perennial promise for a steady cadence of quarterly Xbox games worth showing up for might finally come true. The only thing missing from the event was any accountability for what, and who, Microsoft has sacrificed to get here.
It’s been just over a month since the company announced it’s shutting down three studios and reshuffling a fourth. One of the casualties, Tango Gameworks, and its 2023 hit Hi-Fi Rush, seemed to symbolize the best of Xbox in the Game Pass era: a hyper-stylized passion project from a newer team that wowed critics and won awards and wouldn’t have been possible without the “let a thousand flowers bloom” strategy behind the platform’s pivot to a Netflix-like subscription library. In a crushing reversal, however, the deep-pocketed tech giant cut the team, along with storied immersive sim makers Arkane Austin and others. According to internal comments from Booty and the head of parent company Zenimax, there just wasn’t enough bandwidth for one of the three most valuable companies in the world to manage so many studios.
The bad news and bullshit explanation might not have gone down like a lead balloon if Microsoft hadn’t announced mass layoffs just months earlier across several departments, including newly acquired Activision Blizzard. The cuts hit everyone from the Overwatch 2 team to Call of Duty makers Sledgehammer Games, and included the cancellation of Odyssey, a survival crafting fantasy game that might have become the first new franchise from Blizzard in nearly a decade. Microsoft spent $69 billion on the acquisition, Microsoft Gaming CEO Phil Spencer toured the Activision Blizzard King offices shortly after the deal was finalized last fall, and then in early 2024 the mask came off.
Microsoft Gaming CEO Phil Spencer blamed the heel turn on a combination of investor pressure and the stagnation of the console gaming market in interviews with Game File and Polygon. In other words: capitalism. But the complete closure of Tango Gameworks, originally founded by Resident Evil director Shinji Mikami to train a new generation of creatives, seemed especially capricious. The Xbox team didn’t mention the developers it’s laid off and their contributions in its remarks to a live audience ahead of the showcase today, or during the pre-recorded event itself. (Even after learning its fate, Arkane Austin worked hard to push out Redfall’s much-needed final update.)
Instead, Spencer opened the showcase by promoting Black Ops 6 and the company’s desire to bring one of the most popular franchises to even more players through the power of a $17-a-month subscription. It maybe wasn’t surprising given the billions Microsoft paid to acquire the series, but the choice to open the show this way underscored the new reality of an Xbox brand that now needs to make a return worthy of all of those investments. “I haven’t been talking publicly about this, because right now is the time for us to focus on the team and the individuals,” Spencer told IGN later in the day, away from the hundreds of thousands of fans tunning into the showcase.
He continued:
It’s obviously a decision that’s very hard on them, and I want to make sure through severance and other things that we’re doing the right thing for the individuals on the team. It’s not about my PR, it’s not about Xbox PR. It’s about those teams. In the end, I’ve said over and over, I have to run a sustainable business inside the company and grow, and that means sometimes I have to make hard decisions that frankly are not decisions I love, but decisions that somebody needs to go make.
The showcase, meanwhile, didn’t even clear the bar set days prior by Geoff Keighley at the Game Awards host’s own showcase. Xbox president Sarah Bond, who responded with corpo word salad when asked about studio closures last month, closed out the Xbox showcase by pointing to the future instead of dwelling on the recent past. “It’s our mission to make Xbox the best place to play, by including our own studios’ games on Game Pass at launch, by bringing your games into the future with our commitment to game preservation, by pushing the boundaries in our future hardware, and to empower you to play your games wherever you want on Xbox console, PC, and cloud,” she said. “This is what defines Xbox today and in the future, and we’re hard at work on the next generation.”
It was a commitment aimed at reassuring fans still recovering from the shock of the brand’s recent pivots. But the future is built on the past, and every shiny new Xbox game now comes with the question of what will happen to the teams Microsoft has purchased or partnered with, once it no longer feels like they serve its bottom line.
Update 6/9/2024 9:10 p.m. ET: Added comments from Spencer’s post-show interview with IGN.
In the months (nay, years) leading up to Starfield’s September 6 release, the hype for the Bethesda RPG grew and grew until it was a heretofore unseen beast, a giant Kaiju of expectation that threatened to take down Sony, upend 2023’s GOTY race, and suck up all of gamers’ precious free time.
Head of Xbox Creator Experience Sarah Bond joined in on the fun, calling Starfield “one of the most important RPGs ever made.” Bethesda head Pete Hines said it took him well over 100 hours to properly start Starfield. All of the hype whipped Xbox fans into a frenzy, and indirectly fueled the flickering flames of the console wars. Starfield’s scope, its potential, even made the then-unreleased game a talking point in the FTC trial regarding Microsoft’s purchase of Activision-Blizzard.
Then, after a few days in what Bethesda dubbed “early access,” available to deep-pocketed players who shelled out big bucks for one of several premium editions, Starfield launched. It is surprisingly not buggy, and jam-packed with side-quests that offer a steady drip of serotonin. But it’s woefully inaccessible, its UI is daunting, and it is, ultimately, just a new Bethesda game. There’s nothing wrong with that, but it’s a stark reminder that hype trains are just marketing tools in a different font. Starfield is a good game, but it is not a groundbreaking one.
Before I got a chance to dive into Starfield, I wondered aloud (and on social media) if the game would occupy a similar space in my life that Skyrim has held on more than one occasion. Skyrim never floored me and never lingered after I powered off my console, unlike Marvel’s Spider-Man’s version of Manhattan, or story beats in Mass Effect 2. But every time I dropped back into Skyrim, I fell into the same satisfying loop, emerging from a lengthy play session a little dazed, uncertain of the time, blinking to reaccustom my eyes to the real world outside of its pixels.
Every time I jumped into Skyrim I’d go off searching for some tucked-away relic or NPC in need of help and end up climbing to the top of a peak I saw in the distance, or scurrying through caves like a little gamer Gollum, furiously lining my pockets with shiny objects. I’d “just one more side-quest” myself into the wee hours of the morning, surreptitiously pulling tokes from a pre-roll resting on the table in front of me. No matter what I did, whether it was becoming a vampire or participating in a drinking competition, I was never blown away or taken aback by what Skyrim unfurled before me—I was, however, hooked.
I’m about 20 hours into Starfield and can safely say it is exactly like Skyrim in space. The steady serotonin drip of overhearing a conversation, marking the quest associated with that conversation on my map, completing it, then going back to the list and selecting the next thing is unparalleled. It is the kind of game that completionists salivate over, the kind that I find myself longing to return to and get lost in during my workday, on the train home, while finishing off a workout.
After progressing the main campaign a bit, I violently veered into side-quest territory, spending nearly four hours straight on the Blade Runner-esque planet Neon. I joined a gang, I helped Starfield’s version of Björk recover her music, I tried to console a grief-stricken widow in the shadow of a fish corpse. I paid for VIP lounge access at a bar, helped squash a squabble over a robot that had been vandalized, and rented a room in a hotel just to say I did. Starfield has hooked me in a way that only Bethesda games can, because it is so thoroughly a Bethesda game with a shinier coat of paint.
Image: Bethesda
Expectation versus reality
There is nothing wrong with Starfield feeling familiar—Bethesda’s formula works, and has for over two decades, so I’m not crucifying Todd Howard for refusing to reinvent the wheel. I am, however, noting that there’s a clear disconnect between calling a game “one of the most important RPGs ever made” and that game then reusing long-existing RPG gameplay mechanics and storytelling techniques throughout.
As Kotaku’s Zack Zweizen points out, Starfield is “still a Bethesda RPG. You can almost feel the ancient bones of Morrowind and Fallout 3 poking through bits of the scenery and menus as you play.” Companions still linger behind NPCs chatting you up, players are still almost always overencumbered, enemies still fall over like action figures when you send a gust of gravity their way that feels almost exactly like Skyrim’s Dragon Shouts.
There’s nothing groundbreaking about Starfield, save for maybe its scope, which is possible largely because of the technological advances that have taken place within the last several years, and are now readily available in consumer-facing products like the Xbox Series X/S and modern PCs.
But as for Starfield bringing new ideas to the genre, or adding anything new to its well-worn formula…it doesn’t. Bethesda has been quietly moving its own role-playing goalposts closer to the more shallow end ever since The Elder Scrolls IV: Oblivion, narrowing the scope of what the player can actually influence, placing you in a world that feels perfectly carved out for you to slot into, its problems cleanly laid out for you to solve. Cian Maher’s quote from an Oblivion piece for TheGamercomes to mind: “I also don’t reckon Skyrim ever managed to carve out a portion of its world and imbue [it] with the necessary narrative significance for a conclusion to not seem like deus ex machina.”
Aside from extensive ship-building mechanics, there aren’t any shiny new gameplay additions in Starfield. Building an outpost is just Fallout base-building, leveling your lockpicking or melee abilities follows similar logic to Skyrim, and there are many eerie similarities to Obsidian’s The Outer Worlds. The most noted difference comes not in an updated role-playing system or deeper NPC interactions, but in gunplay—Starfield improves upon Bethesda’s infamous combat clunkiness, and it’s welcome.
But Starfield feels the same way Fallout 4 did, which felt the same way Skyrim did, and that does not make it “one of the most important RPGs” ever made. It just makes it a good Bethesda game, a game made by a studio that Microsoft spent $7.5 billion to acquire. We’d do well to remember that, both as consumers and critics, going forward.
The Xbox app has a section called “popular with friends” that shows you the games your buddies are playing. It can be a handy little tool for bothering your friends about their progress in Diablo IV or needling them over their refusal to stop playing Overwatch 2 (it’s me, I’m that friend).
But based on a picture shared on Reddit, it looks like at least one person has early access to Starfield: Phil Spencer. The screenshot shared shows Spencer’s Xbox profile picture, an Xbox Avatar version of him (notice he’s also wearing a t-shirt and jeans, so it’s lore-accurate) against a purple background, underneath both Starfield and Exoprimal, a dinosaur shooter from Capcom that came to Xbox Game Pass on July 14.
While Spencer playing Exoprimal checks out as the game just launched, his apparent access to Starfield is interesting. It makes sense, though—Spencer and Todd Howard have worked closely together to promote the upcoming Bethesda RPG ever since Microsoft bought Bethesda’s parent company ZeniMax in 2021. At Summer Game Fest, they sat down for a press presentation alongside the head of Xbox Game Studios, Matt Booty, and head of Xbox’s gaming ecosystem, Sarah Bond. If you’re the head of Xbox, you can have a little Starfield early access as a treat.
Based on the Reddit post, it seems like Spencer was playing Starfield on July 14, the day the news dropped that the FTC failed to pause Microsoft’s $69 million purchase of Activision. Maybe he was celebrating the lengthy battle by hopping from planet to planet in Starfield, his mind finally free from fretting over whether Microsoft would get another jewel in its gaming Infinity Gauntlet or not. In space, no one can hear you gloat.
