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Xbox CEO Asha Sharma has outlined her plan to “reset” the Xbox business, and it includes mass layoffs and selling off studios.
In her memo announcing the dramatic shakeup, Sharma also talked about what led to this moment, and one piece is that the Xbox business is “not healthy” due in part to big bets that have not paid off, like Xbox Game Pass.
Xbox is undergoing a strategic “reset.”
She said Microsoft bet on things like Xbox Game Pass, releasing more titles on competing platforms, and a “broader portfolio of content” to help grow Xbox. Those efforts did indeed create “meaningful value,” she said, but a publicly traded company like Microsoft is focused on endless growth–and those businesses “did not grow at the pace we expected.”
“As that happened, our core business weakened, and we added more teams, more investment, and more time, hoping for a better outcome. And now the industry is facing the most severe hardware crisis in its history,” she said.
“We must reset Xbox.”
Xbox Game Pass, launched in 2017, was a breakthrough, Netflix-like offering from Microsoft promising subscribers all
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