Xbox CEO ends Copilot AI development & overhauls leadership

Asha Sharma confirmed Xbox will wind down Copilot on mobile and halt console development entirely, as the new CEO also outlined sweeping leadership changes in a memo to staff on Tuesday aimed at reversing a run of declining revenue.

Sharma took over as Xbox CEO in February following Phil Spencer’s retirement. She joined Microsoft in 2024 after executive roles at Meta and Instacart, and had been serving as president of product in the CoreAI engineering group before moving to Xbox.

Xbox CEO Asha Sharma announces Copilot cuts and leadership overhaul

In the memo, reported by CNBC, Sharma said Xbox needs to move faster and get closer to its community. “Right now, it is too hard to ship impact quickly. We spend too much time inward instead of with the community, and we lack the depth we need in some of the fundamentals,” she wrote.

Through X, she described the Copilot cuts as features that no longer align with the company’s current direction.

“Xbox needs to move faster, deepen our connection with the community, and address friction for both players and developers. Today, we promoted leaders who helped build Xbox, while also bringing in new voices to help push us forward,” she said.

“This balance is important as we get the business back on track. As part of this shift, you’ll see us begin to retire features that don’t align with where we’re headed. We will begin winding down Copilot on mobile and will stop development of Copilot on console.”

Four executives from CoreAI are joining Xbox as part of the shake-up. Jared Palmer, formerly a CoreAI vice president and GitHub senior vice president, moves into a member of technical staff role covering product, engineering, developer tools, and infrastructure.

Tim Allen, who led design and research at CoreAI and GitHub, takes over Xbox design. Jonathan McKay, previously head of growth for ChatGPT at OpenAI, becomes Xbox’s head of growth. Evan Chaki, a CoreAI general manager, will lead a forward-deployed engineering team. David Schloss, senior director of product and growth at Instacart, takes charge of Xbox’s subscription and cloud business.

Two veteran Microsoft executives are departing. Kevin Gammill, corporate vice president for Xbox user experience, game development, and publishing platforms, is leaving.

Roanne Sones, corporate vice president for Xbox devices and ecosystem, is taking a leave of absence after this summer before moving into an advisory role. Both spent 24 years at Microsoft.

Tuesday’s overhaul is not Sharma’s first major move since taking the role, having already cut Game Pass Ultimate price a month after acknowledging in a leaked internal memo that the service had become too expensive. She also teased a new Xbox and Discord partnership.