Xbox CEO: the next console needs to tackle the AI

Xbox CEO Asha Sharma says the company’s next-generation console must prioritize affordability alongside performance, telling the BBC that rising component costs, driven partly by AI spending, have put the entire industry in what she called the middle of a “Rampocalypse.”

An AI-centric memory and storage issue

The term reflects a squeeze that’s hit the entire console industry this year, as memory and storage prices have surged due to AI companies buying up massive quantities of RAM and NAND flash for data centers, a dynamic that has already forced multiple console price increases across the industry well after launch, something that had rarely happened in gaming hardware history before this cycle.

Sharma said the industry has historically not needed to prioritize cost efficiency the way it does now, describing the current pricing environment as a genuine crisis that requires innovation on both fronts. She added that Microsoft wants to give players more choice in how they play and how they purchase a console going forward, rather than just competing on raw specs.

She tied that push directly to how a future console handles storage and memory, pointing to per-unit component costs as an area Xbox needs to rethink when designing what comes after the current Series X and Series S generation. Alongside the affordability comments, Sharma also mentioned Xbox’s new disc-to-digital program, which lets players claim digital copies of physical games they already own. Xbox Insiders can unlock a digital entitlement for supported titles starting next week, with the program launching with thousands of eligible games and more added over time. Sharma framed it as a matter of choice rather than picking a winner between formats, saying simply, “I want to make sure people have a choice.”

Survival choices or general cost-cutting?

Sharma has led Xbox for six months after moving over from Microsoft’s AI division, and has previously called for what she described as the most significant restructure in Xbox’s history following years of underperformance. That reset included cutting thousands of jobs, reportedly leaving some affected employees stunned. She’s framed the broader shake-up as necessary to keep Xbox running for the next 25 years, pointing to a new generation of players who want different ways to play alongside newer technology.

Sharma didn’t offer specifics on price, timing, or hardware for the next Xbox console, and acknowledged the next few years would be challenging for the industry as a whole. Her comments continue a running theme from Microsoft’s gaming leadership this year, following similar affordability remarks in earlier interviews with Fortune and Bloomberg as memory and storage prices have continued climbing industry-wide.

Fan reaction has leaned skeptical about how much real relief is coming. On ResetEra, commenters questioned whether Microsoft or Sony would genuinely absorb losses on next-gen hardware to hit a lower price point, with some predicting either company would instead lean harder on subscriptions and software sales to make up the difference rather than cut console prices outright.

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Rahim Amir Noorali, 2026-08-28 (Update: 2026-08-28)