Head of Microsoft's gaming division is retiring; Xbox business is facing challenges.

Phil Spencer, head of Microsoft's gaming division, will leave the software company that he has worked for for 38 years. Currently, Microsoft's Xbox business is facing increasingly severe challenges. Microsoft CEO Satya Nadella said in an internal memo released on Friday, "Last year, Phil Spencer decided to retire, and since then we have been discussing succession arrangements. I want to thank Phil for his outstanding leadership and companionship." In the December quarter of last year, Microsoft's gaming revenue fell by about 10% year-on-year, exceeding the company's expectations, while total revenue for the same period increased by nearly 17%. In January of this year, Microsoft announced an undisclosed impairment loss for its gaming business. Asha Sharma, who joined Microsoft from Instacart in 2024, will succeed Spencer as Chief Executive Officer of the gaming business, reporting directly to Nadella.