{"id":730166,"date":"2026-06-11T17:11:12","date_gmt":"2026-06-11T17:11:12","guid":{"rendered":"https:\/\/www.newsbeep.com\/ca\/730166\/"},"modified":"2026-06-11T17:11:12","modified_gmt":"2026-06-11T17:11:12","slug":"this-cannot-continue-xbox-leaders-lay-out-hard-truths-behind-sagging-brand","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/ca\/730166\/","title":{"rendered":"“This cannot continue”: Xbox leaders lay out “hard truths” behind sagging brand"},"content":{"rendered":"

Just 100 days ago, when new Microsoft Gaming CEO Asha Sharma replaced long-serving executive Phil Spencer<\/a>, she said she\u2019d work to \u201cunderstand what makes [Xbox] work and protect it.\u201d Now, Sharma and Xbox Studios chief Matt Booty have laid out the many things that are not working for the Xbox brand in a brutal self-assessment the they say necessitates a wholesale \u201cXbox reset.\u201d<\/p>\n

The message sent to Xbox employees and shared publicly via Xbox Wire<\/a> last night paints a grim picture for practically every facet of the Xbox division. That portion of Microsoft is currently only seeing a \u201c3 percent accountability margin\u201d (read: profit margin), down year over year and well below both the game industry average<\/a> and the lofty 30 percent margins that Microsoft is reportedly seeking<\/a> across the board.<\/p>\n

It\u2019s an underperformance, they write, born out of being \u201coverextended\u201d by moves like the $69 billion acquisition of Activision<\/a>. That mega-merger came on top of $20 billion in spending on other acquisitions, platform investments, and hardware subsidies over the last five years, the executives write. But despite the spending spree, Microsoft\u2019s overall gaming revenues are down nearly $500 million compared to five years ago.<\/p>\n

While Microsoft has overinvested in acquisitions and platform spending, Sharma and Booty also admit that Xbox has \u201cnot adequately funded\u201d the company\u2019s \u201cindustry-defining franchises.\u201d That has been somewhat apparent to anyone paying attention to the steady stream of studio-level layoffs<\/a> and game cancellations<\/a> coming out of Redmond, Washington, in recent years. And the company acknowledges that a \u201creliable pipeline of first- and third-party exclusives\u201d is \u201ccritical to our success,\u201d a notable change from the multi-platform strategy<\/a> it pursued with gusto just a couple of years ago.<\/p>\n

Hardware is hard<\/p>\n

On the hardware side, Microsoft is facing the same surge in storage and RAM pricing as the rest<\/a> of the industry<\/a>. But the Microsoft executives also say they \u201cbelieve we have been impacted more greatly than many of our peers due to the choices we made over the last half decade,\u201d a vague but worrying statement about Microsoft\u2019s specific console supply chain issues.<\/p>\n","protected":false},"excerpt":{"rendered":"Just 100 days ago, when new Microsoft Gaming CEO Asha Sharma replaced long-serving executive Phil Spencer, she said…\n","protected":false},"author":2,"featured_media":730167,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[45,49,48],"class_list":["post-730166","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","tag-business","tag-ca","tag-canada"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/730166","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/comments?post=730166"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/730166\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media\/730167"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media?parent=730166"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/categories?post=730166"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/tags?post=730166"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}