Xbox’s journey has been one of resilience, with CEO Asha Sharma revealing that the gaming division, once in “freefall,” is now on a path to renewed growth. During a recent internal all-hands meeting, Sharma shared insights into the brand’s past struggles and its ambitious future, emphasizing the continued importance of the core gaming console while hinting at a more diverse hardware strategy for the tenth generation.
From Freefall to Growth
Sharma candidly admitted that by early 2026, Xbox was experiencing declines across playtime, player numbers, and revenue. The previous Game Pass strategy, she stated, had inadvertently pushed Xbox into a “freefall.” However, the situation has significantly improved, with first-party publishing now showing 2–3 times the growth compared to its lowest point and expected to continue its upward trajectory.
The positive momentum is partly attributed to the strong starts of key titles like Gears of War: E-Day, Minecraft Dungeons II, and World of Warcraft Forever. Furthermore, Sharma highlighted a substantial 30% increase in positive sentiment surrounding the Xbox brand over the past year.
The “Four Cs” Strategy and Console Future
Central to Xbox’s strategy moving forward is the “Four Cs”: Core, Content, Creation, and Connection. Sharma stressed that even in a non-growing console market, Xbox sees opportunities for expansion. This strategy will involve advancing Xbox Cloud Gaming, expanding the disc-to-digital initiative, and growing Xbox Play Anywhere.
Game Pass is also set for evolution, with Sharma promising a more “flexible” approach that could allow players to customize subscriptions based on content type. This suggests a move away from a one-size-fits-all model towards more tailored gaming experiences.
Tenth Generation: A “Range of Devices”
Looking ahead to the tenth generation of Xbox hardware, Sharma confirmed that it will not be a single device but rather a “range of devices.” This marks a significant shift from a singular console focus to a more multifaceted approach, acknowledging that “no single device is going to meet the needs of all players.”
“We are transitioning into a 10th-generation console product line. No single device is going to meet the needs of all players. We will certainly launch with a great home console first, but we also know that a lot of players will be playing out and about,” Sharma stated.
“We have world-class manufacturing capabilities in some areas, and in other areas we will seek partners. We’ll share more information as we get closer to shipping. The operating system currently looks amazing and we are very excited about it.”
This implies a future where Xbox might offer different hardware configurations or even form factors to cater to diverse player preferences and usage scenarios, potentially including more portable or specialized gaming solutions alongside a traditional home console.
Battle.net and Developer Focus
On the PC gaming front, Sharma addressed the Battle.net platform, noting its user retention is nearly on par with Steam. Xbox aims to expand Battle.net’s reach through collaborations, including those with CD Projekt RED, while maintaining its position as a more “curated” platform compared to Steam or the Xbox PC store.
For developers, a key commitment is simplifying the publishing process. Sharma promised to streamline targets and APIs, addressing long-standing developer complaints about the complexity of releasing games on Series X|S, Helix, and Xbox PC. This focus on ease of development aims to foster a healthier and more accessible game creation ecosystem for Xbox platforms.
