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Report: Microsoft weighing up spinning off Xbox
GamesIndustry.biz • • general
Key Points:
- Microsoft is considering spinning off Xbox as a separate entity or restructuring its games division as a wholly owned subsidiary, with other options including forming a joint venture to facilitate a potential sale.
- CEO Satya Nadella and CFO Amy Hood have approved a plan by new Xbox head Asha Sharma to increase spending on developing major franchises like Halo, Fallout, and The Elder Scrolls, though the budget is not yet finalized.
- Over the past five years, Microsoft has invested more than $20 billion in Xbox (excluding Activision Blizzard), but revenue has declined by about $500 million annually, and further layoffs in the gaming division are reportedly planned.
- Nadella emphasized the need to transform Xbox into a sustainable business by innovating in both hardware and games while improving monetization, noting that currently Xbox subsidizes its entertainment rather than profiting from it.
- Asha Sharma, marking her first 100 days as Xbox CEO, plans to reassess the division's strategy to better meet fan expectations and ensure economic viability in both game development and hardware.
