{"id":3444,"date":"2026-07-09T01:04:35","date_gmt":"2026-07-09T01:04:35","guid":{"rendered":"https:\/\/silvybrand.com\/?p=3444"},"modified":"2026-07-09T01:04:35","modified_gmt":"2026-07-09T01:04:35","slug":"microsoft-xbox-spin-off-sell-divest-layoffs-asha-sharma","status":"publish","type":"post","link":"https:\/\/silvybrand.com\/?p=3444","title":{"rendered":"If Microsoft sold off Xbox, who would even buy it?"},"content":{"rendered":"


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This week, Microsoft took a huge ax to its Xbox business. The company announced that it would be laying off 1,600 workers now, 1,600 more over the next fiscal year, and that it would be shedding four studios. Xbox CEO Asha Sharma hasn\u2019t been shy about why she\u2019s making such dramatic cuts, saying in a memo that<\/a> the business is \u201cnot healthy.\u201d Speaking to Fortune<\/em>, she said that<\/a> \u201cwe simply spread ourselves too thin.\u201d<\/p>\n<\/div>\n

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Given the scale of the changes and Xbox\u2019s currently vague strategy of focusing only on big games<\/a>, it\u2019s unclear just what the future of the platform is. As Microsoft invests much of its resources into everything AI, a struggling consumer business with a difficult future doesn\u2019t necessarily seem like a good fit for the company. Which opens up the possibility that Microsoft could be preparing to eventually exit the gaming business altogether by selling off Xbox. This, in turn, raises an even bigger question: Who could possibly buy Xbox?<\/p>\n<\/div>\n

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While nothing has been confirmed, Microsoft\u2019s recent moves make selling off the brand seem like a possible option, as New York University professor Joost van Dreunen tells The Verge<\/em>. \u201cA wholesale divestiture of Xbox remains on the table, and it looks likelier given Xbox\u2019s struggles with rising hardware costs and Microsoft\u2019s focus on AI and infrastructure,\u201d he explains. \u201cIt\u2019s never been clear what role Xbox plays in Microsoft\u2019s flywheel.\u201d But a full sale is the \u201cless likely path,\u201d van Dreunen says. Few buyers, even giants like Netflix, Amazon, Tencent, or a sovereign wealth fund that could theoretically afford the business, would want \u201can entire interactive-entertainment conglomerate running north of $23 billion in annual revenue.\u201d<\/p>\n<\/div>\n

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Image: Xbox Game Studios<\/cite><\/p>\n<\/div>\n<\/div>\n<\/div>\n

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Despite the cuts, Microsoft still has a lot under the Xbox umbrella. It operates a hardware business that sells (increasingly expensive<\/a>) Xbox Series X \/ S consoles, and one of the first things Sharma did was tease Xbox\u2019s next-generation console<\/a>, codenamed Project Helix<\/a>. It still operates a massive roster of game developers: Halo Studios (which works on Halo<\/em>), Bethesda Game Studios (Fallout<\/em>, The Elder Scrolls<\/em>), Mojang Studios (Minecraft<\/em>), Call of Duty<\/em> studios like Infinity Ward and Treyarch, The Coalition (Gears of War<\/em>), Playground Games (Forza Horizon<\/em>, Fable<\/em>), Blizzard Entertainment (Overwatch<\/em>, Warcraft<\/em>), King (Candy Crush<\/em>), and Rare (Sea of Thieves<\/em>). (Kotaku<\/em> has a great list of the current state of Xbox\u2019s studios<\/a>, if you want a refresher.)<\/p>\n<\/div>\n

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Yoshio Osaki, president and CEO of market research firm IDG Intelligence, tells The Verge<\/em> that \u201cI think all options are on the table, considering the drastic measures already put in place to try and restructure the business at both a cyclical and structural level.\u201d Osaki notes that in \u201cearlier years,\u201d it may have been possible for a company like Tencent to explore a wholesale purchase, \u201csince the Western market, especially console, has been more elusive for them.\u201d<\/p>\n<\/div>\n

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But nowadays, Tencent seems to be stepping back from the space, as it\u2019s reportedly looking<\/a> to negotiate exits from many game investments in Japan. That move follows other reported pullbacks from groups that had been known for sweeping investments in games, including Chinese internet giant NetEase<\/a> and the Saudi government-funded Savvy Games Group<\/a>. As for another large tech company taking Xbox over, that seems unlikely; Osaki points to Meta seemingly divesting out of games following its recent metaverse layoffs and VR studio closures<\/a>, while Amazon is focused more<\/a> on its Luna cloud gaming service and using games to highlight other properties it\u2019s building around, like James Bond and Tomb Raider<\/em>.<\/p>\n<\/div>\n

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Entertainment companies like Netflix and Disney could also be potential buyers, but their gaming strategies have generally \u201cveered away\u201d from major mergers and acquisitions in recent years, Osaki notes. Netflix, for example, has had a presence in games for years, but it has let go of many prestige indie titles in its mobile catalog<\/a> and a AAA studio that never released a game<\/a> in favor of TV games players can control with a smartphone<\/a>. While some of Xbox\u2019s more approachable fare, like Candy Crush<\/em> or Minecraft<\/em>, could fit at Netflix, it seems unlikely that something like Halo<\/em> or The Elder Scrolls<\/em> would translate well to a TV party game.<\/p>\n<\/div>\n

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We don\u2019t know what Microsoft\u2019s asking price for Xbox would be. But likely part of the reason it would have few potential suitors is that, if we look at other recent gaming megadeals, the price would be prohibitively high. EA\u2019s take-private deal values the company at $55 billion<\/a>. Microsoft acquired Activision Blizzard in a $68.7 billion deal<\/a>. The entirety of Xbox, inclusive of things like its franchises, studios, and hardware business, would cost significantly more.<\/p>\n<\/div>\n

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Van Dreunen says that the more likely scenario is that big players might go after \u201cspecific pieces\u201d of the Xbox business. Osaki similarly notes that it\u2019s possible that \u201cindividual studios, IPs, and teams are sold or spun off piecemeal.\u201d Microsoft has already shown that it\u2019s willing to do that; it allowed Compulsion Games and Double Fine Productions to go indie<\/a>, while Ninja Theory and Undead Labs have been sold to unspecified buyers.<\/p>\n<\/div>\n

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Image: Mojang Studios<\/cite><\/p>\n<\/div>\n<\/div>\n<\/div>\n

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Sharma hasn\u2019t even been in her role for six months, so it might be a while before we see the full ramifications of her decisions. Many of the remaining studios are focused on household names like Halo<\/em>, Call of Duty<\/em>, Warcraft<\/em>, Minecraft<\/em>, and Candy Crush<\/em>, signaling that Xbox is zeroing in on big properties. Sharma is also elevating Mojang and King by having them report directly to her, saying that the studios \u201chave increasingly become platforms and are our largest by monthly active players.\u201d Minecraft<\/em> could be a preview of Xbox\u2019s model ahead; Sharma believes Microsoft has massively underinvested in the game, according to Game File<\/em><\/a>, and she has appointed Helen Chiang, formerly corporate VP of the Minecraft<\/em> franchise, to be Xbox\u2019s first COO.<\/p>\n<\/div>\n

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Opinions vary on when we\u2019ll get a clearer view of Xbox\u2019s future. Osaki thinks it\u2019ll be by \u201cyear end,\u201d while van Dreunen says that it could be \u201cwithin 24 months.\u201d But what is clear is that, whatever fate awaits Microsoft\u2019s gaming division, the changes at Xbox are far from over. \u201cAs Microsoft looks to free up cash for its AI build-out,\u201d van Dreunen notes, \u201cscaling Xbox back, or selling off parts of it, starts to look worth it.\u201d<\/p>\n<\/div>\n

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