Xbox boss Phil Spencer retires after 12 years as Microsoft Gaming president exits

Phil Spencer is retiring from Xbox after more than a decade reshaping the brand’s future at Microsoft.

The move closes a tenure that began in March 2014, when Microsoft handed him control of Xbox after the troubled Xbox One launch rattled players’ confidence.

He rebuilt trust by cutting the mandatory Kinect bundle and resetting the console price to $399, then shifted the company toward a service-driven strategy built around Xbox Game Pass and long-term studio investment. He later led two industry-defining acquisitions, first ZeniMax in 2020 for $7.5 billion and then Activision Blizzard King in 2023 for $69 billion.

But now, that era is officially ending, bringing forth a couple other changes in the company as well.

Phil Spencer retires as Microsoft Gaming CEO, Sarah Bond exits

IGN reported that Spencer will retire effective Monday, February 23, according to sources familiar with the matter. His departure lands just months before Xbox celebrates its 25th anniversary.

The leadership reset extends beyond Spencer, as Xbox President Sarah Bond also resigned and Microsoft appointed Asha Sharma, currently President of Microsoft’s CoreAI product, as the new CEO of Microsoft Gaming.

Additionaly, Xbox Game Studios head Matt Booty will move into the role of Chief Content Officer and work closely with Sharma.

Microsoft CEO Satya Nadella wrote in an internal email, “Over 38 years at Microsoft, including 12 years leading Gaming, Phil helped transform what we do and how we do it.”

Spencer told staff he had shared his plans last fall. “Xbox has always been more than a business. It’s a vibrant community of players, creators, and teams who care deeply about what we build and how we build it.” He confirmed he will remain in an advisory role through the summer to support the transition.

Sharma outlined three priorities in her own message to employees: “great games,” “the return of Xbox” with renewed focus on console, and expansion across PC, mobile, and cloud gaming.

She also addressed AI directly: “We will not chase short-term efficiency or flood our ecosystem with soulless AI slop. Games are and always will be art, crafted by humans.”