Microsoft Gaming Enters New Era as Phil Spencer Retires and Sarah Bond Departs, Asha Sharma Named CEO

After 38 years at Microsoft and 12 years leading its gaming division Phil Spencer is officially retiring. At the same time, Sarah Bond has announced she is stepping away from Microsoft, marking a dramatic leadership shift at the top of Microsoft Gaming.

The transition, confirmed in internal letters from Microsoft leadership, sets the stage for a new era under Asha Sharma, who steps into the role of Executive Vice President and CEO of Microsoft Gaming.

The End of the Spencer Era

According to Microsoft CEO Satya Nadella, Spencer informed him last fall that he was thinking about stepping back. From there, succession planning began quietly behind the scenes.

Spencer joined Microsoft as an intern in 1988. Over nearly four decades, he helped steer the company through some of its biggest pivots in gaming history. During his tenure as head of Xbox, the business:

Expanded aggressively into PC, mobile, and cloud
Grew through the acquisitions of Activision Blizzard, ZeniMax Media, and Mojang
Nearly tripled in size
Built Game Pass into a pillar of Microsoft’s consumer strategy

He oversaw Xbox’s transformation from a console-focused platform into an ecosystem designed to exist “anywhere and everywhere.”

In his farewell note, Spencer called it “an epic ride” and said he will remain in an advisory role through the summer to ensure a smooth transition.

For longtime Xbox fans, this is the first time since 2014 that someone else will lead the brand.

Phil Spencer, Retiring Microsoft Gaming CEO

Subject: A New Chapter for Microsoft Gaming

When I walked through Microsoft’s doors as an intern in June of 1988, I could never have imagined the products I’d help build, the players and customers we’d serve, or the extraordinary teams I’d be lucky enough to join. It’s been an epic ride and truly the privilege of a lifetime.

Last fall, I shared with Satya that I was thinking about stepping back and starting the next chapter of my life. From that moment, we aligned on approaching this transition with intention, ensuring stability, and strengthening the foundation we’ve built. 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. And it deserves a thoughtful, deliberate plan for the road ahead.

Today marks an exciting new chapter for Microsoft Gaming as Asha Sharma steps into the role of CEO, and I want to be the first to welcome her to this incredible team. Working with her over the past several months has given me tremendous confidence. She brings genuine curiosity, clarity and a deep commitment to understanding players, creators, and the decisions that shape our future. We know this is an important moment for our fans, partners, and team, and we’re committed to getting it right. I’ll remain in an advisory role through the summer to support a smooth handoff.

I’m also grateful for the strength of our studios organization. Matt Booty and our studios teams continue to build an incredible portfolio, and I have full confidence in the leadership and creative momentum across our global studios. I want to congratulate Matt on his promotion to EVP and Chief Content Officer.

As part of this transition, Sarah Bond has decided to leave Microsoft to begin a new chapter. Sarah has been instrumental during a defining period for Xbox, shaping our platform strategy, expanding Game Pass and cloud gaming, supporting new hardware launches, and guiding some of the most significant moments in our history. I’m grateful for her partnership and the impact she’s had, and I wish her the very best in what comes next.

Most of all, to everyone in Microsoft Gaming, I want to say “thank you”. I’ve learned so much from this team and community, grown alongside you, and been continually inspired by the creativity, courage, and care you bring to players, creators, and to one another every day.

I’m incredibly proud of what we’ve built together over the last 25 years, and I have complete confidence in all of you and in the opportunities ahead. I’ll be cheering you on in this next chapter as Xbox’s proudest fan and player.

—Phil

XBL: P3

Sarah Bond’s Departure

As part of the transition, Sarah Bond one of the most visible leaders in modern Xbox strategy has also decided to leave Microsoft.

Bond played a central role in shaping Xbox’s recent direction, including:

Expanding Game Pass
Pushing cloud gaming initiatives
Supporting next-gen hardware launches
Navigating the Activision Blizzard acquisition

Spencer credited her as instrumental during “a defining period for Xbox.” Her next destination hasn’t been announced, but her departure marks another major shift in Xbox leadership.

Asha Sharma Steps In

Asha Sharma takes over at a pivotal moment.

Before joining Microsoft two years ago, Sharma held leadership roles at Instacart and Meta, building and scaling consumer platforms used by billions. Nadella emphasized her experience aligning long-term value with platform growth as a key reason for her appointment.

In her first message to the Microsoft Gaming team, Sharma laid out three core commitments:

1. Great Games First

She stressed that everything begins with unforgettable experiences strong characters, innovative gameplay, and creative risks. She reaffirmed investment in both iconic franchises and bold new ideas.

2. The Return of Xbox

Sharma promised a renewed focus on Xbox’s core fans, starting with console. While Microsoft will continue expanding across PC, mobile, and cloud, she emphasized strengthening the Xbox identity rather than diluting it.

3. The Future of Play

She acknowledged AI and evolving monetization models but made it clear the company won’t flood the ecosystem with “soulless AI slop.” Her stance: games are art, crafted by humans, supported by technology not replaced by it.

It’s a tone that feels both reassuring and ambitious.

Asha Sharma, New Microsoft Gaming CEO

Dear team,

Today I begin my role as CEO of Microsoft Gaming.

I feel two things at once: humility and urgency.

Humility because this team has built something extraordinary over decades. Urgency because gaming is in a period of rapid change, and we need to move with clarity and conviction.

I am stepping into work shaped by generations of artists, engineers, designers, writers, musicians, operators and more who create worlds that have brought joy and deep personal meaning to hundreds of millions of players. The level of craft here is exceptional, and it is amplified by Xbox, which was founded in the belief that the power of games connect people and push the industry forward.

Thank you to Phil for his leadership, and to every studio, platform, and operations team that built this foundation. We are stewards of some of the most loved stories and characters in entertainment and bring players and creators together around the fun and community of gaming in entirely new ways.

My first job is simple: understand what makes this work and protect it.

That starts with three commitments.

First, great games.

Everything begins here. We must have great games beloved by players before we do anything. Unforgettable characters, stories that make us feel, innovative game play, and creative excellence. We will empower our studios, invest in iconic franchises, and back bold new ideas. We will take risks. We will enter new categories and markets where we can add real value, grounded in what players care about most.

I promoted Matt Booty in honor of this commitment. He understands the craft and the challenges of building great games, has led teams that deliver award-winning work, and has earned the trust of game developers across the industry.

Second, the return of Xbox.

We will recommit to our core Xbox fans and players, those who have invested with us for the past 25 years, and to the developers who build the expansive universes and experiences that are embraced by players across the world.

We will celebrate our roots with a renewed commitment to Xbox starting with console which has shaped who we are. It connects us to the players and fans who invest in Xbox, and to the developers who build ambitious experiences for it.

Gaming now lives across devices, not within the limits of any single piece of hardware. As we expand across PC, mobile, and cloud, Xbox should feel seamless, instant, and worthy of the communities we serve. We will break down barriers so developers can build once and reach players everywhere without compromise.

Third, future of play.

We are witnessing the reinvention of play.

To meet the moment, we will invent new business models and new ways to play by leaning into what we already have: iconic teams, characters, and worlds that people love. But we will not treat those worlds as static IP to milk and monetize. We will build a shared platform and tools that empower developers and players to create and share their own stories.

As monetization and AI evolve and influence this future, 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, and created with the most innovative technology provided by us.

The next 25 years belong to the teams who dare to build something surprising, something no one else is willing to try, and have the patience to see it through. We have done this before, and I am here to help us do it again. I want to return to the renegade spirit that built Xbox in the first place. It will require us to relentlessly question everything, revisit processes, protect what works, and be brave enough to change what does not.

Thank you for welcoming me into this journey.

-Asha

Matt Booty’s Expanded Role

Alongside Sharma’s appointment, Matt Booty has been promoted to Executive Vice President and Chief Content Officer.

Booty now oversees a studio network spanning nearly 40 teams across Xbox Game Studios, Bethesda, Activision Blizzard, and King home to franchises like Halo, The Elder Scrolls, Call of Duty, World of Warcraft, Diablo, Fallout, and Candy Crush.

Importantly, Booty clarified there are no organizational changes planned for the studios themselves.

The message: stability in content, evolution at the top.

Matt Booty, Xbox Chief Content Officer

I read Phil’s note with much gratitude. He has been a steady champion for game creators and our studio teams, and I’ve learned so much from his leadership over the years. All our games have benefited from his foundational support. I’m also grateful to Satya for his ongoing commitment to gaming and holding a vision of how it can connect back to the larger company.

Looking forward, I’m excited to partner with Asha as our next CEO. Our first conversations centered on her commitment to making great games and the role that plays in our overall success. She asks questions, pushes for clarity, and wants our choices grounded in player and developer needs. That mindset matters as the industry around us is changing quickly: how players engage, how games are made, and how business models and platforms evolve.

We have good reasons to believe in what’s ahead. This organization and its franchises have navigated change for decades, and our strength comes from teams who know how to adapt and keep delivering. That confidence is grounded in a strong pipeline of established franchises, new bets we believe in, and clear player demand for what we are building.

My focus is on supporting the teams and leaders we have in place and creating the conditions for them to do their best work. To be clear, there are no organizational changes underway for our studios.

Thanks for everything you do for players and for each other.

—Matt