Something to look forward to: Microsoft CEO Satya Nadella has pushed back on rumors that the company plans to wind down its gaming business to focus on the more profitable worlds of AI and cloud services. During an internal Q&A, Nadella told employees that Microsoft is "long on gaming" and intends to increase its investment in the division in the years ahead.
Speaking with newly appointed Microsoft Gaming head Asha Sharma, Nadella dismissed speculation that the company might abandon gaming in favor of Windows, Azure, and AI. He described gaming as one of Microsoft's "main identities" over the past couple of decades and said it will remain a core part of the company's business portfolio going forward.
Nadella also emphasized gaming's influence across Microsoft's broader ecosystem, noting that it has acted as an accelerator for the company's cloud and personal computing businesses. At the same time, he acknowledged recent missteps that sparked backlash from gamers and said Microsoft will "always" continue investing in gaming in the foreseeable future.
Gamers went into panic mode last week after Seamus Blackley, co-creator of the original Xbox, claimed that Microsoft was "sunsetting" the Xbox brand as part of a broader plan to exit the segment within the next few years. The post fueled speculation about the end of Xbox consoles and sparked fears that major acquisitions such as Activision Blizzard could lose value.
Seamus' claim followed a series of leadership changes inside Microsoft's gaming division, including the departure of longtime gaming chief Phil Spencer and the unexpected resignation of Xbox president Sarah Bond. The decision to appoint AI executive Asha Sharma to lead the division also led some industry watchers to interpret the move as the beginning of the end for Microsoft's traditional gaming business.
Despite the speculation, Microsoft recently confirmed long-standing rumors that its next Xbox will be a hybrid between a console and a PC, capable of running both Xbox and Windows games. Last week, Sharma revealed that the upcoming system is codenamed "Project Helix" and will support titles from both ecosystems.
The hybrid console will reportedly be manufactured and marketed by traditional PC vendors such as Asus, which already sells the ROG Xbox Ally handheld. Rumors suggest the device will be powered by an AMD APU codenamed Magnus, combining 10 Zen 6 CPU cores with an RDNA 5 GPU.