Xbox boss Phil Spencer is leaving Microsoft after nearly 40 years at the software giant. Xbox president Sarah Bond is also leaving Microsoft, a major shakeup in the leadership of Xbox and Microsoft’s gaming efforts. Asha Sharma, current product president of CoreAI, takes over as CEO of Microsoft Gaming.
Microsoft CEO Satya Nadella announced Phil Spencer’s retirement today in a message to all Microsoft employees. “Last year, Phil Spencer decided to leave the company and we’ve been talking about succession planning ever since,” says Nadella. “I’d like to thank Phil for his extraordinary leadership and partnership. During his 38 years at Microsoft, including 12 years as Head of Gaming, Phil has helped transform what we do and how we do it.”
Asha Sharma succeeds Phil Spencer as the new CEO of Microsoft Gaming. Sharma is currently the president of the CoreAI product at Microsoft and has worked closely with Microsoft’s AI platform efforts since joining Microsoft in 2024. Spencer will remain in an advisory role over the summer to support the transition.
While Sharma isn’t a gamer like Spencer, he has some consumer experience that could certainly help lead a division as large as Microsoft Gaming. Sharma left a marketing role at Microsoft in 2013 and worked at Meta as vice president of product and engineering and Instacart as chief operating officer before returning to Microsoft in 2024.
Nadella says he is “long for gaming and its role at the center of our consumer ambitions” and believes Sharma has “deep experience in building and scaling platforms, aligning business models with long-term value and operating at a global scale, which will be critical to leading our gaming business into its next era of growth.”
Sharma now has three commitments for the future of gaming at Microsoft: great games, the return of Xbox, and the future of gaming. “We’re recommitting to our core Xbox fans and players, those who have invested with us over the past 25 years, and the developers who create the vast universes and experiences embraced by gamers around the world,” Sharma says in an internal release. “We will celebrate our roots by renewing our commitment to Xbox, starting with the console that shaped who we are. It connects us to the gamers and fans who invest in Xbox, and to the developers who create ambitious experiences for it.”
In a message to Xbox employees, Spencer reveals that he has decided to leave Microsoft in the fall of 2025, just months after rumors of Spencer’s potential retirement began circulating online. Microsoft said in July that Spencer “will not be retiring anytime soon.”
“Last fall, I shared with Satya that I was thinking about stepping down and starting the next chapter in my life,” says Spencer. “Since that moment, we’ve agreed to approach this transition with purpose, ensuring stability and strengthening the foundation we’ve built. Xbox has always been more than just a business. It’s a vibrant community of gamers, creators and teams who care deeply about what we build and how we build it. And it deserves a thoughtful and thoughtful plan for the way forward.”
As part of the journey ahead for Xbox, president Sarah Bond is also leaving Microsoft to “start a new chapter,” according to Spencer. “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 leading some of the most significant moments in our history,” says Spencer.
Microsoft also promoted Matt Booty to EVP and Chief Content Officer after previously promoting him to the position of expanded president of game content and studios in 2023. “I read Phil’s note with great gratitude,” Booty says in an internal message to Microsoft’s gaming staff. “He’s been a steadfast champion for game developers and our studio teams, and I’ve learned a lot from his leadership over the years. All of our games have benefited from his core support.”
You can read the full report on Phil Spencer’s retirement here.
Spencer has been with Microsoft since he first joined as an intern in 1988. In his early career at Microsoft, he worked on Encarta, Microsoft Money, and Microsoft Works. Spencer joined the Xbox division in 2001 and became CEO of Microsoft Studios in 2008. In 2014, he became head of the Xbox division, overseeing the launch of the Xbox Series X/S and support for Microsoft’s Xbox Game Pass.
Spencer has also been at the center of Microsoft’s major gaming acquisitions, including Minecraft produced by Mojang, Activision Blizzard and ZeniMax Media.
“When I walked through the doors of Microsoft as an intern in June 1988, I never could have imagined the products I would help build, the players and customers we would serve, or the extraordinary teams I would be fortunate enough to join,” says Spencer. “It was an epic ride and truly the privilege of a lifetime.