RESOLVING THE LEDGER
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A new Asha Sharma memo has hit Xbox. In it, the CEO shed light on her core priorities and goals to get Microsoft's gaming division back to strong growth and profits after another 1,600 of its employees were laid off at the beginning of the month . Among other things, the plan calls for Xbox to be halfway to a stated goal of 1 billion users per day. It's currently at 100 million.
Insight into Sharma's plan comes from The Verge , which shared excerpts from the latest memo to be sent to Xbox staff on July 30. In its earnings report this week, Microsoft reported double-digit declines in revenue on both the hardware and games and services sides, with total revenue for the year declining by $1.7 billion. Xbox's new CEO laid out four main priorities to pull the platform out of that tailspin in the next fiscal year:
CORE: Strengthen our platform, led by console
CONTENT: Grow great games into global franchises
CREATION: Make Minecraft the world’s creator platform
CONNECTION: Extend the worlds that fans love
While each priority begins with the letter C, the actions entailed in following through on them are less obvious. Heading into 2028 and 2029, the plan is to "move into businesses producing meaningful player value and revenue acceleration." By 2030, the goal is to be "halfway to our long-term daily-player goal with sustained double-digit growth in players and engagement and industry leading margins.”
In her now infamous "reset" memo announcing cuts to 3,600 Xbox employees over the next 12 months, including closing or spinning off several studios, Sharma said she wanted Xbox to be one of the few companies that "entertains" more than a billion people each day. Today's memo stated that Xbox is currently at 100 million . Getting halfway to a billion within four years would seem to require unprecedented growth of nearly 50 percent annually.
Sharma went on to call Xbox "one of the largest stadiums in the world," a metaphor reminiscent of Google's failed Stadia play, and said that while the Xbox console remains a "flagship experience," Xbox will also be searching for new players through PC, cloud, and other platforms. Long-term plans include monetizing big franchises like Fallout “across film, television, consumer products, sponsorship, live experiences, and form new partnerships globally, including China," as well plowing even more investment to Candy Crush and Minecraft .
At one point, the CEO reportedly mentioned being more focused on not just the company's biggest franchises but its "biggest new ideas." It looks like we'll have to wait a little longer to find out what those might be.
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