Outgoing Xbox President Sarah Bond's 'Xbox Everywhere' Strategy 'Offended' Employees: Report

Microsoft shocked the gaming world last week when it announced sweeping changes to Xbox leadership. Phil Spencer, the erstwhile Microsoft Gaming CEO, confirmed he was retiring effective immediately. His role now belongs to Asha Sharma, a Microsoft insider previously focussed on AI. Spencer also announced that Xbox president Sarah Bond was leaving the company. A new report claims that Bond lost favour at Microsoft over the “Xbox everywhere” strategy.

Sarah Bond's Strategy 'Offended' Xbox Employees 

Citing conversations with Xbox employees, The Verge reported (paywalled) Monday that Bond, who was widely seen as Spencer's successor and had increasingly become the face of Xbox in recent years, was passed over for Xbox leadership. According to the report, Bond spearheaded Microsoft's “This is an Xbox” marketing campaign that debuted in 2024. However, the campaign, which told customers that they didn't need to buy an Xbox console to play Xbox games, failed to win any favours, even within Microsoft.

The marketing campaign, which focussed on phones, tablets, smart TVs and other supported devices instead of Xbox Series S/X consoles, reportedly offended Xbox employees internally. The report claimed that many Microsoft employees were “relieved” that Bond was exiting Xbox. The executive was reportedly difficult to work with, and months after she was promoted to Xbox president and chief operating officer in late 2023, two senior Xbox executives left the company.

Bond's “Xbox everywhere” strategy was reportedly questioned internally multiple times. As Microsoft has sought new Xbox users via Cloud, Game Pass, and Xbox Play Anywhere features on an array of supported devices like laptops, phones, tablets, smart TVs, Fire Stick, and Windows-based gaming handhelds, sales of the Xbox Series S/X have tumbled.

Last month, Microsoft reported that its Gaming revenue fell 9 percent, while Xbox content and services revenue decreased 5 percent in the second quarter for FY 2026. Xbox hardware revenue, on the other hand, fell 32 percent.

Phil Spencer's Retirement 'Not Planned'

The Verge's report also backed Microsoft's announcement that said Phil Spencer had decided to retire last year. According to the report, the former Xbox chief's retirement seemed “inevitable” to employees over the past year.

Rumours of Spencer retiring surfaced online in July last year when Microsoft announced widespread layoffs at Xbox. Microsoft denied the rumours at the time, saying Spencer was “not retiring anytime soon”. Just over seven months later, the company announced his retirement.

However, Greg Miller, the founder of Kinda Funny media company and noted industry insider, has said that Spencer's retirement was not “planned,” suggesting the former Xbox boss was forced to step down.

Discussing the Xbox leadership shake-up on the latest episode of the Kinda Funny Games podcast, Miller said he didn't believe that changes were in the making for the past year. “I've been passed something that again reiterates to me that this was not planned,” Miller said.

Phil Spencer led Xbox since 2014
Photo Credit: XboxOn/ YouTube

Xbox's 25th Anniversary

Xbox will celebrate its 25th anniversary in 2026, and it does seem odd for Spencer, who has led Xbox since 2014, to retire abruptly before the landmark occasion. At Xbox Games Showcase last year, Spencer said he was looking forward to upcoming games from Xbox's biggest franchises in 2026.

“Looking ahead, next year marks 25 years of Xbox. It's a big milestone for the platform and franchises that you helped build and make popular. We couldn't have done this without everyone who's been with us on this journey,” Spencer had said at the showcase.

“As we think about bringing a new generation of players to these iconic franchises, I'm excited to share that players will get to celebrate 25 years of Xbox with a new Fable, the next Forza, Gears of War: E-Day, and the return of a classic that's been with us since the beginning.”

The “classic” Spencer was referring to was later announced as Halo: Campaign Evolved, a remake of Halo: Combat Evolved, coming to PC, Xbox Series S/X, and PS5 this year.

Over the past two years, Spencer oversaw Microsoft's pivot to a multiplatform release strategy. Multiple first-party Xbox titles are now available on PS5 and Nintendo Switch platforms, with more on the way this year. Fable, Forza Horizon 5, Halo: Campaign Evolved are already confirmed for PS5 and Starfield is rumoured to launch on Sony's console this year, as well.

Spencer's replacement, Asha Sharma, who previously served as an AI executive at Microsoft, has no experience in gaming, but has promised to recommit to Xbox's core fans. In her memo, Sharma said she would focus on the “return of Xbox”, primarily through a renewed commitment to Xbox consoles.