Core Insights - Phil Spencer, CEO of Microsoft Gaming, is leaving the company after a 38-year tenure, amid challenges in the Xbox business [1][2] - Microsoft experienced a 10% decline in video game revenue in the December quarter compared to the previous year, despite a total revenue growth of nearly 17% [2] - The company made a significant $75 billion acquisition of Activision Blizzard to expand its gaming business, but current Xbox consoles have not matched the popularity of competitors like Sony's PlayStation and Nintendo's Switch [3][4] Leadership Changes - Asha Sharma, who joined Microsoft in 2024 from Instacart, will succeed Spencer as CEO of gaming, reporting to Microsoft CEO Satya Nadella [5] - Sharma has a background in product leadership and gaming, having previously worked at Meta and Microsoft [5][6] - Matt Booty will report to Sharma as executive vice president and chief content officer, while Sarah Bond, president of the Xbox unit, will leave Microsoft [6][7] Strategic Focus - The new leadership aims to recommit to core Xbox fans and developers, emphasizing the importance of long-term relationships with players [6] - Nadella expressed confidence in Sharma and Booty's ability to drive platform innovation and enhance the content pipeline for Microsoft Gaming [7]