Asha Sharma has recently presented an update regarding major changes to XBOX. These changes are in response to the company’s newly established necessities, including the 3-10x lower profit margins and growth of Game Pass. XBOX’s previous developments have significantly made the company’s work culture unhealthy, which forced the new CEO to close 1,600 job positions as of her announcement. She is also aiming to implement changes to revitalize the company’s structure and productions throughout the fiscal year 2027, including major layoffs and reconfigured management.
According to Sharma’s message, the first issue she addressed was related to the company’s content. She recognized XBOX’s expansive growth through multiple purchased studios without any changes to the company’s content output. Instead of closing down entire gaming studios, she signed off multiple teams to become independent with their restored IPs, such as Double Fine and Compulsion Games. While Arkane Studios is researching its options, Ninja Theory and Undead Labs are open to joining new ownership without any cancellations of projects.
“We have also learned that we are not the best home for every type of studio; in a typical year, we lost 64 cents for every dollar we invested. As we reset XBOX, we will help independent creators succeed by providing open development tools and audiences to realize their vision”
While XBOX has parted ways with certain studios, the company was still overly bloated from previous leadership. This has forced Sharma to reduce the currently owned studios, such as Bethesda/Zenimax, Activision, Blizzard, Xbox Game Studios, King, and Mojang. As of the announcement, 1,600 workers were laid off before more are scheduled to leave throughout fiscal year 2027, estimating over 3,200 closed positions. Despite the layoffs, she is planning to work more closely with Mojang and King due to the two companies’ popular platforms gaining the most players.
The second issue Sharma is tackling is the company’s platform, which has grown exceedingly complex with about 14 management layers. This design has greatly hindered the company’s productivity and processing, which is why Sharma is diminishing management to at most five layers. A smaller management structure will improve the company’s processing through the teamwork of three main roles: makers, player-coaches, and DRIs (Directly Responsible Individuals for major decisions).
The final issue Sharma is configuring is the company’s operation, which has the team disoriented from the extended growth. She has enrolled Helen Chiang as the first Chief Operating Officer with P&L (Profit and Loss) responsibility across multiple avenues within XBOX, reporting any updates directly to the CEO. Chiang will replace Dave McCarthy, who will retire after contributing over 17 years of work to the company. This will make Sharma more involved with any developments through simpler, direct connections.
Asha Sharma isn’t just looking to make XBOX healthier and more cooperative for its business, but also for its fanbase. The company’s ideal vision is to become welcoming and appealing to the general audience, enough to keep them invested in the XBOX platform for the long term. This is why Sharma wishes to reconstruct the company to provide the best source of entertainment for the fans, hoping to have a billion people play on the XBOX platform daily. The CEO will plan to deliver more details about the major changes within the current year.
“This year, we’ll invest as much in XBOX as we ever have, but we’ll invest with greater focus, greater discipline, and greater clarity, all in service of making XBOX where the world plays and creates; I want XBOX to be one of the few companies that entertains more than a billion people each day and gives everyone the opportunity to create and connect.”
