We’re just a little over a week out from Xbox’s big summer showcase, and CEO Asha Sharma is rallying her troops with an update on the status of Game Pass and a hint at what her evolving mission within Microsoft will look like over the coming months. The big theme is making sure Xbox stays focused on delivering where it counts.
“We are building a stronger XBOX,” she wrote in a new memo shared with The Verge. “That means making hard choices about what we build, where we invest, and what kind of company we need to be going forward. That is part of what you are starting to see in the shift from Xbox to XBOX. It reflects a decision to be deliberate in how we show up for the players who care most about this brand.”
My first reaction is that this might be the first time I’ve ever seen an executive try to explain the meaning of an all-caps rebrand. The second reaction is a question. What exactly does Sharma mean by “hard choices”? In c-suite speak, it’s often code for cuts and layoffs. Pulling money out of what’s not working and re-investing it in what is might sound like Business 101, but the devil is always in the details.
One of the hard choices Sharma might be referring to is her decision to decrease the price of Game Pass and pull Call of Duty out of the program. The recently revealed Modern Warfare 4 will not be available day-and-date on the service like last year’s Black Ops 7 was. “Growth slowed down and subscriber loss accelerated after the pricing and SKU changes last year,” Sharma said in her memo. “Since our price reduction we have seen acquisitions grow and retention improve, which is a good first step.”
That’s good news for the platform, even if it feels a bit like reversing an own goal. But what other hard choices might lie ahead? We’re almost a year out from from the last round of devastating Xbox cuts. In addition to those laid off, promising projects were also canceled. That included a long-in-the-making reboot of Perfect Dark that wowed fans in its 2024 showcase appearance, as well an ambitious new sci-fi MMO called Project Blackbird at Zenimax Online Studios.
It’s not yet clear if the cuts are done with or if Sharma is still evaluating out how to re-deploy resources across her division. Buried in her April memo to staff was a line about returning the “business to durable growth with strong cost discipline.” The CEO has continued to signal her commitment to Xbox’s most passionate fans in various ways, including by letting them vote on whether to make Xbox all caps or not. Time will tell what parts of the now-sprawling Xbox business she thinks those fans will care most about.