Xbox Game Studios Boss Is Out Ahead Of Reported Layoffs And Other Major Changes To “Reset” Xbox
Craig Duncan, the former head of Xbox Game Studios, is stepping down from his role after 15 years at Microsoft, marking a significant shift as the company prepares for reported layoffs and potential studio closures. His departure comes amid a broader restructuring effort led by Xbox CEO Asha Sharma, who has emphasized the need to "reset" the Xbox business to ensure long-term sustainability. Alongside Duncan, his chief of staff, Louise O'Connor, is also leaving the company, signaling a major shakeup within the division.
Duncan had been the studio head at Rare, the developer behind Sea of Thieves, before being promoted to the role of Head of Xbox Game Studios in November 2024. He succeeded Matt Booty, who was later elevated to executive vice president and chief content officer at Xbox. Before joining Xbox, Duncan held various roles at Codemasters, including development manager and director of product development. He also worked with Midway Games before it closed in 2009 and later joined Sumo Digital before moving to Rare in 2011.
Duncan’s exit from Xbox was announced just 48 hours after he posted on LinkedIn expressing his excitement for the future of Xbox Game Studios and its upcoming projects. His post, which highlighted the potential of the division, now stands in stark contrast to the current reality of significant changes and uncertainty.
Louise O'Connor, who served as chief of staff for Xbox Game Studios since August 2025, is also leaving the company. O'Connor had a long career at Rare, beginning as an animator in 1999 and rising through the ranks to become Head of Animation and later Art Director. Her tenure at Xbox Game Studios was marked by her dedication to supporting the creative teams across the division.
In a memo to staff obtained by The Game Business, Duncan reflected on his time at Xbox, stating, "I’m proud to say we delivered many flawless launches that drove business success for the company." He also praised O'Connor, saying she "consistently championed the craft and supported our studios with clarity and care."
Microsoft CEO Satya Nadella recently addressed the challenges facing the Xbox division, acknowledging that it has been struggling for some time. He emphasized the importance of transforming Xbox into a "sustainable business" and outlined the need for strategic changes to achieve that goal.
In other developments related to Xbox, it has been reported that Microsoft is considering spinning off the Xbox division to focus on more targeted growth strategies. This move could also accelerate the development of major franchises such as Halo and Fallout, which have been under development for several years. These changes, combined with the leadership shakeup, indicate a major shift in the direction of Xbox as it seeks to redefine its place in the evolving gaming landscape.
