This is no secret Xbox has struggled over the past few years to the point where many gamers have either gleefully or sadly declared the console “dead”. While it's certainly not out of business yet, it would be false to pretend that there's nothing wrong with the Xbox right now as it's suffered a major fall from grace.
During the Xbox 360 generation, Microsoft seemed unstoppable. The console's main competitor, the PlayStation 3, struggled to produce must-play exclusives during its first few years on the market, and the higher price didn't help. Eventually, however, the tide turned. The PS3 started favoring home exclusives like Uncharted 2 and The last of usand the introduction of cheaper units made the console much more affordable. Xbox, on the other hand, stumbled with the marketing and introduction of Kinect, a motion tracking device that was placed at the forefront of the console's branding strategy despite falling short of its lofty promises. This set the stage for the next generation of consoles, which Xbox undeniably lost according to former head of Xbox Gaming Phil Spencer. Things may be on the rise, but it's going to take a lot of work to get Xbox back to where it needs to be.
'We know we have work to do' Xbox boss reacts to Q3 2026 revenue decline
New Xbox boss Asha Sharma shares her thoughts on the company's latest earnings report, which shows a year-over-year decline.
Xbox is gearing up for a strong 2026
Xbox has spent the last few years infecting a lot of the goodwill it once had with its consumer base. There are several reasons for this, but perhaps the biggest is the apparent lack of exclusives that were once promised. At the turn of the current console generation, Xbox was gobbling up a number of beloved studios and IPs, including all under the ZeniMax and Activision-Blizzard umbrella, and preparing for an onslaught of Xbox exclusives to compete with the likes of God of War and The Legend of Zelda.
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The promise of these exclusives is why many gamers bought the Xbox Series X|S instead of the PS5 at launch. But in the end, Xbox gamers once again didn't get any real exclusives, watching from the sidelines as PlayStation got well-received exclusives in addition to highly promoted first-party titles from Xbox. With disastrous Game Pass price hikes and a poorly timed “This is Xbox” campaign, the Xbox Series X|S has taken over as the industry's most optional console.
The good thing is that Xbox seems to know this and is initiating major management and operational changes to address these concerns. Most notably, Phil Spencer's four-year tenure has ended and Asha Sharma has replaced him as CEO of Microsoft Gaming. I still have some concerns about Sharma, mainly due to her lack of experience in the games industry and her former position at Microsoft AI, but she's doing all the right things so far. Under her leadership, Xbox reduced the newly expensive Game Pass to create a more balanced offering, unpopular Xbox features such as Microsoft Copilot integration were massively scaled back, and a commitment was made to unify on the Xbox console.
We'll see how these decisions indicate Sharma's long-term plans for Xbox, but in the meantime, the brand has some silver bullets in the chamber. Forza Horizon 6 has gone down well with fans and critics alike, with many praising it as the best in the franchise and looking promising Fable With the reboot due out later this year, we could see opinions on Xbox starting to move in a more positive direction.
What Xbox will need to succeed in the long term
You may have noticed that I've referred to Xbox as a brand a few times, and that's because, for better or worse, that's how it's been defined this generation. The performance differences between the Xbox Series X and the PS5 are negligible at best, and if you can play almost any Xbox game elsewhere, what's the point of the console itself? That's the narrative that's surrounded Xbox for years, and that's what will have to change to reassert its market dominance. It needs to be less of a brand and more of a must have console.
Sharma hinted at a return to true console exclusives, though I'd imagine plenty of Xbox games will still launch on PC as well. Still, blocking future Xbox games from coming to PlayStation and Nintendo platforms would be the most obvious way to make the Xbox a more important device. Right now, when it comes to exclusivity, getting an Xbox is a disadvantage because there are tons of games that the console will never get, but virtually none that will be exclusively for it. That needs to change if Microsoft wants to move consoles and further strengthen gamers within its ecosystem.
Going back to traditional exclusive practices could be tricky for Xbox, as it could be seen as just taking games away from PS5 and Switch 2 users, rather than actually giving Xbox users something new. Still, it's a fee that may need to be paid.
I don't want to sugarcoat anything: public perception of the Xbox is probably still at an all-time low. Other bold decisions like Sharma's departure from Copilot and the recontextualization of Xbox Cloud Gaming will be needed to move the story forward. I'm not sure what these next steps will entail, but if Xbox keeps strong and fun gaming experiences (rather than unwanted AI features) at the core of its strategy, then it could return to glory in the years to come.
