If you read Kotaku even semi-regularly, you already know that Xbox has been in a weird spot for some time now. And with today’s news that both Xbox boss Phil Spencer and President Sarah Bond are leaving and the new head of the brand will be a former Meta exec who previously lead Microsoft’s AI division, I think it’s time to call it. Xbox is dead. Time of death: February 20, 2026.
This death is far from sudden or surprising. If anything, we’ve all seen it coming for a while now. Reading the news about Xbox often felt like checking in on someone battling a terminal disease and whose fight wasn’t going well. Looking at the endless layoffs, impossible demands from leadership, canceled projects, flops, games getting ported to PlayStation, and loads of mismanagement, it seemed clear that in recent years, Xbox wasn’t doing well.
The beginning of the end
If I had to pick the moment when things truly got bad, it would be when Xbox bought Activision Blizzard. After spending $70 billion and enduring years of legal challenges to its efforts to buy the Call of Duty and Warcraft publisher, Xbox finally pulled it off in 2023. But suddenly, Xbox found itself under much more pressure to deliver. Xbox was no longer just a console created by Microsoft as a small side hustle; instead it had morphed into a massive publisher with a huge suite of studios, franchises, and employees to manage. Over the next two years, everything started to change at Xbox.
The company began de-emphasizing the idea that you even needed to own an Xbox to play Xbox games. This is an Xbox, remember? Want to play Halo or Gears of War but don’t own an Xbox? Don’t worry, the games are launching on PC. Don’t want to play on PC? It’s fine, you can stream them via your phone or TV. You don’t even have to buy the games, just pay for this monthly subscription. When a console brand stops trying to sell consoles, you can probably stick a fork in it.
We here at Kotaku called the end of the console war around this time. But we didn’t call the death of the Xbox just then. That’s because, despite all the signs, there was always that chance that Phil Spencer would right the ship again, as he had done before, and keep Xbox alive.
AI and porting Halo
And then Microsoft, like all big tech giants these days, began investing even more billions of dollars into AI. And here was Xbox, a pricey side project that never made the company much money, but was costing the company a ton on massive deals to buy Bethesda and Activision. That was cash that could be spent on datacenters and Copilot, damn it!
This is around the time that Microsoft began trying to shove AI into Xbox in a very awkward fashion, one that felt removed from Spencer’s stewardship of the brand. In 2025, after already porting some of its smaller games, like Sea of Thieves and Grounded, to PlayStation and Switch, Xbox did the unthinkable. It announced plans to bring Halo to PlayStation 5, yet one more big sign that it was all over. Spencer would never promote this news on social media.
That brings us to today. Xbox will no longer be run by a “gamer.” Instead, Asha Sharma, an AI executive who previously worked at Meta and InstaCart and who has no video game industry experience at all, has been put in charge of the brand despite another person, Sarah Bond, being seemingly the perfect successor to Spencer. Sharma’s hiring has generated a lot of speculation, with some theorizing that she’s a temp pick until Microsoft completely devours Xbox and turns it into nothing more than an icon on your desktop that you never click. Others have suggested she’s been put in place to help bring AI to Xbox in a big way, which seems very likely, too.
Regardless of why she’s been made the new Xbox boss, it is now very clear: Xbox is dead. The corpse will linger around for a bit longer, but the odds of a new Xbox console hitting shelves are low. I suspect all future hardware will be rebranded PCs, like the ROG Ally X handheld from last year. A slow death for a console that once was huge, but was sunk by tech executives who had no idea what they were doing.
