Microsoft's Xbox chief lays out plan to pass rivals on margin by 2030 in memo to employees

Microsoft's new Xbox chief, Asha Sharma, has outlined a plan to increase the gaming unit's profitability by 2030 in a memo to employees. Sharma, who replaced Phil Spencer as Xbox CEO in February, aims to match the margins of competitors by next year and surpass them by mid-decade. In her message, Sharma emphasized that the company will not rely on past successes or dwell on past failures, instead focusing on creating experiences that players will love for decades.

Sharma has already made changes to Xbox, including lowering Game Pass subscription prices, reducing the workforce by laying off and divesting from four development studios, and emphasizing exclusive titles. Despite a 10% decline in quarterly revenue, Microsoft's stock surged by almost 16% on Thursday, marking its strongest session since 2008. Sharma and Xbox's chief content officer, Matt Booty, had previously stated they expected a 3% internal margin.

In her memo, Sharma set ambitious goals, including doubling the number of players and engagement and achieving industry-leading margins by FY30. She also stated that Xbox will build long-term plans for its biggest franchises across various mediums, forge new partnerships globally, and capitalize on the success of Activision Blizzard. Sharma highlighted her commitment to investment in Minecraft, aiming to strengthen player experiences and expand creation and sharing tools.