It’s the end of an era for millions of Xbox Game Pass users

2026's price reduction is starting to make sense Xbox as we know it is about to look very different, CEO Asha Sharma announced Monday in a publicly distributed memo detailing the company’s new plans. 3,200 layoffs. Four (maybe five) studio divestments. Sweeping changes to management structures. And broad implications about how Xbox will approach its business over the next 12 months. Amid it all, Game Pass, Xbox’s games-on-demand service and the linchpin of its strategy in the post-COVID era, was curiously absent from today’s announcement, at least explicitly. In her memo to staff, Sharma mentioned “Game Pass” just once, in a paragraph that can most generously be read as a skewering of former CEO Phil Spencer’s decade-long regime: "Our business today is not healthy. We are operating at margins that are 3-10x lower than comparable platform and publishing businesses. We entered Gen 9 with a smaller install base and a higher cost structure. To grow, we bet on Game Pass, multi-platform, and a broader portfolio of content. While those businesses have created meaningful value, they did not grow at the pace we expected. As that happened, our core business weakened, and we added more teams,