Amid layoffs and falling gaming revenue, Xbox CEO Asha Sharma lays out multi-year growth strategy

Microsoft-owned Xbox is charting an aggressive turnaround strategy following one of the most turbulent periods in its history, with CEO Asha Sharma outlining an ambitious roadmap aimed at restoring player and revenue growth by the end of fiscal year 2027.

According to The Verge, which obtained an internal memo sent to Xbox employees on July 30, Sharma said the gaming division is focused on reversing its recent struggles after sweeping layoffs, studio restructuring, and declining financial performance.

The strategy comes weeks after Microsoft announced thousands of job cuts across its gaming division as part of a major organisational reset. Recent quarterly results also showed Xbox content and services revenue fell 10%, while hardware revenue declined 13%, highlighting the challenges facing the business.

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Four priorities to drive Xbox's comeback

In the memo, Sharma laid out four key priorities that will guide Xbox's recovery:

• Strengthen the core platform, with consoles remaining at the center of the Xbox ecosystem.
• Expand successful games into global entertainment franchises.
• Transform Minecraft into the world's leading creator platform.
• Deepen fan engagement by extending popular gaming worlds across different experiences.

"By the end of FY27, we will return XBOX to player and revenue growth," Sharma told employees.

She highlighted that Xbox aims to scale profitability to industry standards, adding that every function and studio would be responsible for contributing to set goals.

Long-term goal

Beyond the immediate recovery, Sharma outlined a multi-year roadmap extending through 2030. The memo reportedly targets reaching halfway toward Xbox's long-term ambition of entertaining one billion people daily by the end of the decade.

Reportedly, Xbox has around 100 million daily users, and the new strategy will help expand major franchises such as Minecraft, Fallout, and Candy Crush through media adaptations, consumer products, partnerships, and international expansion, including China.

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Rebuilding after a difficult year

Sharma took over as Xbox CEO earlier this year and has overseen significant structural changes aimed at improving efficiency. These include spinning off several studios, streamlining management layers, and refocusing investment on the company's biggest franchises and platforms.

The turnaround plan follows what has been a difficult financial period for Xbox, with Microsoft reporting declines in both hardware and gaming services revenue despite strong overall company performance driven by its cloud and AI businesses.