Xbox chief executive Asha Sharma has warned that Microsoft's gaming business cannot rely on established franchises alone, saying it must continue creating new intellectual property (IP) to secure its future. Her comments come as Xbox continues to deal with the fallout from major job cuts and changes to its studio portfolio.
Speaking at an internal Xbox town hall, Sharma acknowledged the changes being made to the company's content strategy. According to Windows Central, transcripts of the meeting were shared with the publication by multiple sources and verified. Microsoft has not publicly released an official transcript of the discussion.
'On content, I think this is probably the thing that you are all seeing the most about as we're making a lot of changes,' Sharma said.
Xbox Boss Issues a Stark Warning
Sharma said Xbox would continue investing in its biggest franchises while also developing original games capable of attracting new audiences. Her remarks emphasised the need to build on established successes without relying exclusively on them.
'We're backing our strongest franchises. I want our great games to become great global billion-dollar franchises. I would also like to see us continue to create enduring new IP. We will not survive if we only revive on the past. We have to find new ways, and courage, to have invention on new IP, that reaches new sets of audiences.'
The comments highlight the challenge facing Xbox as it attempts to strengthen its established brands while creating the next generation of successful gaming franchises.
Microsoft's gaming portfolio includes major properties such as Call of Duty, World of Warcraft and Candy Crush, alongside Xbox franchises including Halo, Forza and Gears of War.
However, Sharma's comments make clear that established franchises are not the only priority. Xbox also wants to develop original intellectual property capable of reaching audiences beyond its existing fan base.
Creating a successful new franchise can require substantial investment and years of development, with no guarantee that a game will become a commercial hit. That makes the balance between supporting established properties and backing original ideas a significant challenge for the business.
Job Cuts Raise Questions Over Xbox's Future
Sharma's commitment to new IP comes against the backdrop of a major restructuring of Microsoft's gaming business. In July 2026, Microsoft announced plans to cut approximately 3,200 Xbox roles throughout its 2027 financial year, which runs until 30 June 2027. Around 1,600 role eliminations were announced for 6 July, with further reductions planned over the following months, according to GamesRadar+.
The restructuring also involved four studios leaving Xbox for new management. Compulsion Games and Double Fine Productions were to become independent studios, while Ninja Theory and Undead Labs entered arrangements to move to new ownership. These changes should not be confused with studio closures.
The changes have raised questions about how Xbox will balance reducing costs and strengthening its biggest franchises with its stated ambition to create new ones.
Sharma has also discussed simplifying the organisation and focusing on Xbox's strongest franchises. The challenge now is to demonstrate that the restructuring can support the company's long-term ambitions while giving its development teams a viable path forward.
Today we're standing up XBOX LABS (https://t.co/wzXPNnCmI6). Here is the note that I sent to the team:
— ASHA (@asha_shar) October 13, 2026
Team,
The first video games emerged some 75 years ago. In the time since, there have been booms and busts, but every year there are more great games to play, more devices to…
The town hall comments do not establish that the job cuts will prevent Xbox from developing new IP, nor do they directly link the workforce reductions to Sharma's warning about relying on past successes. The two developments nevertheless form part of a broader period of change for Microsoft's gaming division.
Can Xbox Create Its Next Billion-Dollar Hit?
Sharma's remarks also raise a wider question for Xbox: how can it turn successful existing games into larger franchises while continuing to invest in original ideas?
In an earlier interview with Windows Central, Xbox chief content officer Matt Booty made a similar point about the potential of smaller projects, saying: 'everything big once started as something small'.
Booty's comment reflects the potential for smaller ideas to grow into major properties, although it does not guarantee that every new project will become a commercial success.
For Xbox, the challenge is to identify and support promising ideas while continuing to invest in the franchises that already attract large audiences.
That balancing act will be important as Microsoft reshapes its gaming business. Established franchises can provide a foundation, but Sharma's remarks suggest Xbox does not want its future to depend solely on revisiting familiar titles.
Xbox must now show that it can continue supporting its biggest games while creating original properties that reach new audiences. Sharma has made clear that relying only on past successes is not enough. Whether Microsoft's restructuring can help deliver both enduring franchises and successful new IP will be a key test of the company's strategy.
