Xbox chief says growth is back after restructuring and job cuts

Xbox has started to return to growth after months of layoffs and studio sales, chief executive Asha Sharma has told staff.

The update came at an Xbox town hall meeting, as reported by Eurogamer on 7 October. Sharma, who took over as Xbox CEO in February after Phil Spencer left the business, reportedly said declines in hours played, player numbers and revenue at the start of the year had now turned.

The low point came early this year. Sharma reportedly said growth since that all-time low was now more than two to three times what it was, and the fall in hours played had stabilised. "We're making the right decisions to reinvest in the business," she reportedly told staff.

Sharma pointed to three recent releases with strong starts. She named Gears of War: E-Day, Minecraft Dungeons 2 and World of Warcraft: Forever as contributors to the upturn. She also reaffirmed that Project Helix, the codename for Xbox's next-generation hardware, will be a family of devices rather than a single console.

For players, this means the plan is more Xbox hardware options, not fewer, alongside new games. Sharma also addressed Game Pass, Xbox's subscription library where members pay a monthly fee for access to games. She said the previous Game Pass strategy had sent the service's profitability into freefall, a sharp drop she wants to correct.

What makes this stand out is the scale of the reset behind it. Sharma has called the changes the most significant restructure in Xbox history, a reorganisation that has cost more than 1,800 roles. Microsoft is also selling four Xbox studios as part of the process, and the restructuring work is not expected to finish until next summer.

The leadership change was sweeping. Spencer left in April, with Sharma taking over as chief executive of Microsoft Gaming. Sarah Bond also left Xbox as part of that shakeup. Sharma has since said Microsoft chief executive Satya Nadella backs her restructuring plan.

The cuts followed a difficult year across the company. Microsoft had planned to cut 4,800 jobs as part of a restructuring that included an overhaul of its Xbox unit, according to Reuters in July. Around 1,600 Xbox employees were affected by layoffs that month, as reported by The Verge in September.

Sharma has denied reports that Microsoft is considering selling the Xbox business. She told The Verge in an interview published on 30 September that Xbox is not for sale. "I think the industry will require disruption," she said in a separate interview that week, setting out her case for a leaner Xbox built around hardware, subscriptions and big releases.