Xbox’s New CEO Just Admitted What Gamers Have Been Saying for Years
Hannah covers horror, sci-fi, and games at Collider, where she writes news and features, reviews new releases, and interviews the people who make them. She’s helping build out Collider’s gaming coverage, with Pokémon as one of her specialties. If she isn’t writing about a monster, she’s probably watching one on a tape from her VHS collection.
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Xbox has spent the last several years trying to convince players that its future extends far beyond a traditional console. The company expanded Game Pass, brought major releases to rival platforms, and pushed the idea that practically any screen could become an Xbox. But that strategy also left the brand with an increasingly confusing identity while many longtime console owners questioned whether Microsoft was still invested in them.
Those concerns became much harder to dismiss as Xbox hardware sales struggled and Microsoft enacted multiple rounds of layoffs, closures, and major studio restructuring. The company has since reversed several controversial decisions, including removing Call of Duty from Game Pass, cutting the service’s price, and making exclusive games part of its strategy again. Xbox has also resumed investing in Series X|S marketing and recently introduced a new alternative to physical media, signaling that the console itself is back at the center of its plans.
According to a new report, Xbox CEO Asha Sharma addressed employees during an internal town hall and offered a blunt assessment of where the company’s previous strategy went wrong. Sharma reportedly told staff that Xbox started 2026 declining in players, hours played, and revenue, while reiterating that its previous Game Pass approach had sent the company into “freefall” on the balance sheet. She described the company’s position as an “all time low,” an especially brutal admission after years of Microsoft presenting Game Pass as the foundation of Xbox’s future.
Xbox’s Game Pass Strategy Reportedly Sent the Brand Into “Freefall”
Sharma now claims Xbox’s first-party business has returned to growth at “more than two to three times what we were,” although Microsoft has not released the underlying numbers or clarified the baseline behind that comparison. She highlighted Gears of War: E-Day, Minecraft Dungeons 2, and World of Warcraft Forever as games with strong starts, while reportedly telling employees that Xbox must better serve its console audience before it has “the right” to expand beyond that market. The company’s next generation, currently known as Xbox Helix, is still envisioned as a family of devices that will include a traditional console and portable options, but Xbox’s immediate comeback plan appears to begin with something its frustrated players have demanded for years: treating the people who already own an Xbox like they matter.
Whether that will be enough to repair the damage is another question. Xbox players have watched the company change direction before, and an internal admission will not immediately restore their confidence. Still, acknowledging how badly the previous strategy failed is a necessary first step.
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