I’ve been covering Xbox for over a decade, and the same cycle keeps coming up time and time again: Microsoft itself is Xbox’s biggest enemy. And to save Xbox, Asha Sharma will need to convince CEO Satya Nadella that subsidizing their recent sprint of poor decisions will take more than one or even two fiscal years.
Indeed, documents seen by Windows Central and verified by proven sources revealed a range of options Xbox considered to try and meet Microsoft’s “30% by 2030” accountability margin targets. These included every absolutely dire option you can imagine. It included things like cost-saving by cutting backward compatibility with Xbox One and Xbox Series X|S generations with future hardware, and moving towards “evolving to be more software-based vs. hardware-based.”
That was pretty dire. It sounds like there is little interest in Xbox hardware at MS. I also had no idea Xbox needed to be saved right now.
There has always been this small notion that helix exists for the sole purpose of providing a soft landing for current customers. Where they could eventually pull the plug on Xbox hardware and hopefully retain some customers on their pc store through helix.
This idea is all of a sudden sounding way more plausible.
Jez’s artice, true or not, just shows how MS just can’t get out of their own way on anything. Constant flailing.
It’s also not an issue that a leadership shake up on the excutive level can fix.
Because every new CEO and CFO will always look at Xbox financials and have the same thought why are we doing things that lose money? Move to stop those things and then panic at the disco like Nadella is foing now.
Wish someone would ask nadella, why is MS in the position to need to get customers back? That’s the hard part of leadership. Any knucklehead can say we need more customers.
If I was still on an Xbox one and was thinking about upgrading, that article said enough for me to pass on Xbox. MS does not know why they are in the console business. Just totally clueless. For Xbox to succeed, they need owners who believe in it. For proof of that simple concept, just look at the competition.
It’s like if nadella doesn’t know why they are in this business just pull the plug. It goes to show how massive MS is. A 25b division is treated like it doesn’t matter.
It’s because of Microsoft’s size, and just how public stock companies are. They HAVE to show constant growth specifically to investors. There are a lot of arguments that doing anything else is irresponsible and there are a lot of investors that get very angry when they see Microsoft bleeding money or even just not investing in growth sectors properly. It’s the investors who own the company ultimately and those investors want their investment to be more valuable. They don’t care about anything else.
It’s honestly a miracle that Xbox exists at all and a miracle that it’s become the most consumer friendly option. The original Xbox actually cost Microsoft money. It’s estimated that they lost up to 7 billion USD. They chose to go ahead with the 360 largely out of fear of losing the “living room” to Japanese companies. Fast forward to 2026 and every console “lost the living room”. The console market itself isn’t growing and the target audience isn’t there. The console gamer is becoming an increasingly older and more niche market individual. And no one really knows what to do to change that. The Xbox One tried in horrible execution and the way Sony responded resulted in the market doubling down and rejecting change. Xbox was going to get killed then, but Phil turned it around. Since then Game Pass, Cloud Gaming, PC, and Mobile have all been hail marys. Game Pass really worked for a time to build a consistent revenue stream and boost engagement, but more recently they’ve struggled to grow total subscribers and it as a service is peaking. PC & Cloud are what’s left but the latter they’re struggling to grow along with game pass and the former they still need more foundational work in. Mobile is on hold until they can get courts to open up iOS and Android. None of those are console, but if they can grow the business elsewhere and keep console at the center then the business overall can stay healthy.
Microsoft is going to do what makes them more money. The same goes for Nintendo and Sony. I’m equally concerned for all three consoles, if not more concerned because just nothing is working to actually grow the market. Nintendo can get by on its massive IP and a strong user base that’s willing to pay premium prices for hardware and software that has very controlled costs. Playstation seems to be struggling a little bit on what exactly to do with their software and their software similarly isn’t doing so hot in actually releasing and being sold. However, their hardware is largely getting by just on upgrades and higher prices. Xbox remains in third place and has had a poor (or downright negative) response to their strategies to grow. Even something traditional (not cloud gaming or multiplatform) like just having a budget console in the series S became a whole blown out issue.
I don’t think Microsoft “wants” Xbox gone. Ideally gaming would be their major entertainment growth sector. However, it’s that struggle to actually consistently grow Xbox at a rate investors are satisfied with. The entire console market is struggling to grow in sheer size (they are managing to grow in spending from each existing user), and Xbox has it the worst both being in third place and just dealing with a very tribal industry that starts a riot over everything Xbox does.
To me Helix is a path forward that will future proof Xbox. I think of it like this: consoles kinda suck in terms of actually safeguarding libraries. Before now every other generation completely axed last Gen support. In reality Xbox abandoning hardware tomorrow will be no different from PS3 games not working on the PS4 yesterday. However, Xbox has already managed to future proof my purchases on Xbox in a way that no console ever has through Xbox Play Anywhere. Helix should take things even further by merging Xbox & Windows development. I don’t know if Microsoft will keep making Xbox consoles, but I do know that regardless of if they do or not my library is already more safe on Xbox than it is PS5 or the Switch.
The article is spot on pretty much makes me have even less fate in Asha. I certainly hope she can turn things around but can’t say I have been impressed so far. The COD removal felt more like a company thing than a consumer one to me especially if they come back with new tiers that just make the full thing more expensive. I think they are going to have to make some bold changes at this June showcase that shows they are for the consumers. It really feels like they’re on the clock.
Xbox has a solid chance the question now is can they execute and does Microsoft have the patience?
Given how it kinda looks like Satya and Amy are backing off for now, at least, I would say the chance is now for Sharma to do something about the core fans, the overall ecosystem, and the Xbox brand.
I do think it’s in the right direction, which I have the feeling is the case for once.
Althought do have to say, seeing both a lot of negativity or realism in this thread but i guess is to be expected when it comes to someone as Nadella or Hood.
I definitely hope Asha can turn things right though I do feel her coming in will bring a lot of business-as-usual in. She’s saying the right things and I’m wondering if that is all her or a mixture of advice coming from the old guard. I think you will keep seeing some negativity until certain stands are made like the exclusivity one and a clarity of what Game Pass under her will be. She’s got a chance with GTA to do a lot. Work on differentiating features that enhance the experience and get the consoles at a bargain.
