Xbox chief executive Phil Spencer is leaving Microsoft after nearly 40 years at the software giant. Xbox President Sarah Bond will also be leaving Microsoft, marking a major change in the management of Xbox and Microsoft’s game businesses. Asha Sharma, currently President of CoreAI Products, will become CEO of Microsoft Gaming.
Microsoft CEO Satya Nadella today announced Phil Spencer’s retirement in a memo to all Microsoft employees. “Last year, Phil Spencer made the decision to retire from the company. Since then, we have been discussing succession planning,” Nadella said. “I want to thank Phil for his exceptional leadership and partnership. During his 38 years at Microsoft, including 12 years leading our games division, Phil helped transform what we do and how we do business.”
Asha Sharma will succeed Phil Spencer as the new CEO of Microsoft Gaming. Sharma is currently president of CoreAI products at Microsoft and has been working closely with Microsoft’s AI platform efforts since returning to the company in 2024. Mr. Spencer will continue in an advisory role through the summer to support the transition.
Sharma isn’t a gamer like Spencer, but he does have some consumer experience that could help him lead a big division like Microsoft Gaming. Sharma left her marketing job at Microsoft in 2013 and worked as vice president of product and engineering at Meta and chief operating officer at Instacart before returning to Microsoft in 2024.
Nadella said he “admires games and the role they play at the heart of our consumer ambitions,” and believes Sharma has “deep experience in building and growing platforms, aligning business models to long-term value, and operating on a global scale, which will be critical as we lead our games business into the next era of growth.”
Sharma is currently working on three initiatives for the future of gaming at Microsoft. It’s the future of great gaming, the return of Xbox, and the future of play. “We recommit to our core Xbox fans and players, those who have invested in us over the past 25 years, and our developers to build expansive universes and experiences that are embraced by players around the world,” Sharma said in an internal memo. “We’re celebrating our roots with a new commitment to Xbox, starting with the consoles that shaped us. It connects us with the players and fans who invest in Xbox, and the developers who build ambitious experiences for it.”
In a memo to Xbox employees, Spencer announced his decision to retire from Microsoft in the fall of 2025, just a few months later. Rumors spread on the internet Regarding Spencer’s possible retirement. Microsoft said in July that Spencer was “not retiring anytime soon.”
“Last fall, I shared with Satya that I was looking to take a step back and start the next chapter of my life,” Spencer says. “From that moment on, we approached this transition with intention, ensuring stability and aligning to strengthen the foundation we built. Xbox has always been more than just a business. Xbox is a vibrant community of players, creators, and teams who care deeply about what we build and how we build it, and we deserve thoughtful and deliberate planning for the path forward.”
As part of Xbox’s future path, president Sarah Bond will also be leaving Microsoft to “start a new chapter,” Spencer said. “Sarah has been instrumental in a defining period for Xbox, shaping our platform strategy, expanding Game Pass and cloud gaming, supporting the launch of new hardware, and guiding us through some of the most important moments in our company’s history,” Spencer said.
Microsoft is also promoting Matt Booty to EVP and chief content officer. promote him “I read Phil’s memo with great appreciation,” Booty wrote in an internal memo to Microsoft gaming employees. “He has been a steadfast champion of game creators and our studio team, and I have learned much from his leadership over the years. All of our games have benefited from his foundational support.”
You can read books by Phil Spencer Click here for the full resignation memo.
Spencer has been with Microsoft since 1988, when he first joined the company as an intern. During his early career at Microsoft, he worked on Encarta, Microsoft Money, and Microsoft Works. Spencer joined the Xbox division in 2001 and became general manager of Microsoft Studios in 2008. He then became head of the Xbox division in 2014, overseeing the launch of Xbox Series X/S and the push for Microsoft’s Xbox Game Pass.
Mr. Spencer was also a key figure in Microsoft’s major gaming acquisition. minecraft Manufacturer Mojang, activision blizzardand zenimax media.
“When I walked through the doors of Microsoft as an intern in June 1988, I could never have imagined the products I would help develop, the players and customers I would serve, or the incredible team I would be lucky enough to join,” Spencer says. “This was an epic ride and truly the privilege of a lifetime.”