Microsoft's Xbox division is shifting its focus towards measuring success through daily active players, a strategy inspired by social media platforms aimed at enhancing user engagement. This change comes as Xbox faces declining revenue, which fell by 9% to $5.96 billion during the latest holiday quarter, with content and services underperforming against expectations.
In a memo titled “We Are Xbox,” Xbox CEO Asha Sharma and Chief Content Officer Matt Booty addressed employee frustrations and outlined a new vision to reevaluate game exclusivity, release timing, and the role of AI in their operations. The memo reflects their approach as they begin their leadership roles and acknowledges the competitive landscape, particularly with Sony's PlayStation and the successful launch of Nintendo's Switch 2.
Sharma recently implemented her first significant change by reducing the price of Game Pass Ultimate from $29.99 to $22.99 per month, while also excluding new Call of Duty titles from the day-one release lineup. Additionally, the memo mentions Project Helix, a next-generation console expected to deliver high performance, with developer hardware anticipated by 2027.