Microsoft announced a major leadership transition within its gaming division on February 20, 2026. Phil Spencer, who joined Microsoft as an intern in 1988 and led Xbox for 12 years, retired from the company. Asha Sharma stepped in as the new CEO of Microsoft Gaming, bringing experience from her previous roles at Instacart and Meta.
The transition affects multiple executives across the gaming division. Matt Booty moved from heading Xbox Game Studios to become Executive Vice President and Chief Content Officer. Sarah Bond, who served as Xbox President, departed Microsoft to pursue new opportunities. Spencer will remain in an advisory capacity through summer 2026 to support the transition.
Microsoft Gaming currently reaches over 500 million monthly active users and operates nearly 40 studios across Xbox, Bethesda, Activision Blizzard, and King. The division includes franchises like Halo, The Elder Scrolls, Call of Duty, World of Warcraft, Diablo, Candy Crush, and Fallout. This change comes as Xbox prepares to celebrate its 25th anniversary in November 2026, with planned releases including major gaming titles across its platforms.
New Era for Microsoft Gaming
Phil Spencer retires after 38 years at Microsoft as Asha Sharma takes over as CEO and Matt Booty rises to Chief Content Officer
Phil Spencer’s Journey
From intern to Xbox’s most recognizable leader
Leadership Changes
Three major transitions shape Xbox’s future
Asha Sharma’s Three Commitments
A roadmap for Xbox’s next chapter
Great Games
Unforgettable characters, stories that make us feel, innovative gameplay, and creative excellence. Empower studios, invest in iconic franchises including beloved gaming franchises, and back bold new ideas across new categories and markets.
Return of Xbox
Recommit to core Xbox fans and players who invested over 25 years. Celebrate roots with renewed focus on console while expanding across PC, mobile, and cloud. Break down barriers so developers can build once and reach players everywhere without compromise.
Future of Play
Invent new business models by leveraging iconic teams, characters, and worlds. Build shared platforms and tools for developers and players to create their own stories. Games will remain art, crafted by humans with innovative technology.
I’ve long admired Phil’s unwavering commitment to players, creators, and his team, and I am personally grateful for his leadership and counsel. We have extraordinary creative talent across our studios and a global platform that is second to none.
What Comes Next
The transition marks a shift for Microsoft Gaming as it approaches Xbox’s 25th anniversary in November 2026. Sharma outlined three priorities: creating great games, renewing focus on Xbox’s core fanbase, and building the future of play through new business models and platforms.
Booty confirmed no organizational changes are planned for the studios under his oversight. The nearly 40 studios across Xbox, Bethesda, Activision Blizzard, and King will continue their current projects. Microsoft Gaming maintains its position as a top publisher across all platforms with over 500 million monthly active users.
Spencer’s departure follows his decision shared with CEO Satya Nadella in Fall 2025. His 12-year tenure as gaming head saw the business nearly triple in size, expand across PC, mobile, and cloud platforms, and complete major acquisitions including Minecraft, ZeniMax, and Activision Blizzard. The gaming industry continues to watch how Sharma’s leadership will shape Xbox’s direction, particularly regarding platform strategy and studio operations moving forward.