Microsoft gaming leadership changes: Phil Spencer retires, Asha Sharma new CEO

Microsoft's gaming division is undergoing its most significant leadership changes in years. Phil Spencer, who has led Xbox and the Gaming division for over a decade, will officially retire on February 23, 2026. Around the same time, it was announced that Sarah Bond is stepping down from her role as president of Xbox. Asha Sharma, previously head of the CoreAI division, has been appointed as the new CEO of Microsoft Gaming.

Spencer began his career at Microsoft in 1988 and played a key role in transforming Xbox from a traditional console business into an ecosystem of services, cloud gaming, and the Game Pass subscription. Microsoft CEO Satya Nadella thanked him for his extraordinary leadership, while Spencer noted that he had planned this transition with leadership in advance. He will remain as an advisor until summer to ensure a smooth handover.

Sharma's appointment came as a surprise to the industry. Before joining Microsoft in 2024, she worked at Meta, and her experience is not directly tied to the gaming business. In her first address to employees, Sharma outlined three priorities: creating truly strong games, returning Xbox to its roots, and shaping the future of gaming without chasing short-term gains or soulless AI-generated content.

Against this backdrop, the question remains whether Xbox's strategic direction will shift. In recent years, the brand has focused on services and multiplatform availability. The departure of two key figures marks the end of an era for Xbox, and the future of Microsoft Gaming will now depend on how the new team balances innovation, AI technologies, and the expectations of its dedicated audience.