Xbox CEO Asha Sharma told CNBC that Microsoft aims to surpass the profit margins of Sony and Nintendo by mid-2030. Sharma outlined plans to build long-term strategies across film, television, consumer products, sponsorship, and live experiences, with heavy investment in Minecraft and new global partnerships including China. She wrote that Xbox expects revenue growth to accelerate in fiscal years 2028 and 2029, targeting "industry-leading margins" by Financial Year 2030.
The division faces headwinds. US Xbox Series hardware sales dropped 27% year-over-year in September 2026, hitting a new all-time September low, according to Circana tracking data. Xbox posted a 10% quarterly revenue decline. Sharma cited supply constraints but gave no specifics.
Console prices rose again in August, making them more expensive than at launch in November 2020. Xbox underwent a "reset" phase under Sharma that eliminated over 1,600 jobs and cut several studios from the portfolio.
Sony recorded a 9.9% operating margin from game and network services in its latest financial year. Nintendo reached close to 16% in its fiscal year.
Xbox is expanding beyond gaming through a new XP division focused on movies, TV, and live events. Recent multimedia projects include the third season of the Fallout TV series, a Call of Duty movie, a Diablo animated series, and a Minecraft theme park opening in 2027.