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Phil Spencer Reflects on 38 Years at Microsoft: 'I Never Could Have Imagined the Path Ahead'

  • Phil Spencer, the longtime head of Xbox, is retiring after 38 years, with retirement effective February 23, 2026, and Satya Nadella recently announced Asha Sharma as his successor.
  • Performance strains such as declining player counts and strategic shifts prompted the change, as Xbox sales fell, concurrent players dropped since Modern Warfare II, and the $69 billion purchase shaped the Game Pass pivot.
  • Sarah Bond's sudden departure coincided with the leadership shifts, Matt Booty was promoted to Chief Content Officer, and Asha Sharma promised not to flood the ecosystem with `AI slop`.
  • Sharma frames her brief as supporting consoles while unifying devices, pledging tighter integration across consoles, PCs, mobile, and cloud alongside Microsoft AI initiatives including Copilot and the `agentic OS` concept.
  • Some commentators declared Xbox 'dead' as Spencer's exit ends a chapter for a leader known for Game Pass and major studio acquisitions, with Sharma seen as an AI-first pivot.
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Artificial intelligence chief to replace Phil Spencer.

·Budapest, Hungary
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Under his leadership, a multi-billion dollar deal was closed to acquire game producer Activision Blizzard, known for Call of Duty and Candy Crush.

·Netherlands (Kingdom of the)
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The Verge broke the news in United States on Friday, February 20, 2026.
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