Overview
- Xbox CEO Asha Sharma and Xbox Game Studios chief Matt Booty posted a public memo this week starting a 100‑day reset that says current spending and falling revenue “cannot continue.”
- Multiple outlets report the company plans significant job cuts and deep budget trims, with those layoffs expected to occur after Microsoft’s fiscal year ends on June 30.
- The memo states Xbox spent more than $20 billion over five years on content, platform and hardware subsidies while annual revenue fell about $500 million and the division will close the year with roughly a 3 percent accountability margin.
- Sharma warned of a hardware component crisis, saying storage and memory costs have surged and could top five times recent prices by the 2027 holiday season, which is squeezing console supply and forcing a rethink of Project Helix and hardware partnerships.
- Leadership signaled a shift in content strategy toward select console exclusives, a likely reassessment of the studio footprint and big cuts to marketing budgets, changes that could include studio-level restructurings and will affect employees and release plans in the weeks ahead.