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Microsoft shelves Copilot for Xbox, scales back AI in gaming
Copilot for Xbox was introduced last year

Microsoft shelves Copilot for Xbox, scales back AI in gaming

May 06, 2026
02:14 pm

What's the story

Microsoft has announced the retirement of its AI-powered gaming assistant, Copilot for Xbox. The company will wind down the feature on mobile and halt development on Xbox consoles. The decision was revealed by Xbox chief Asha Sharma, who has been instrumental in reshaping the platform since taking over as CEO in February.

Strategic shift

Copilot on Xbox didn't fit with Microsoft's future direction

Sharma said the Copilot feature on Xbox didn't fit with the company's future direction. She announced this decision as part of a larger strategic shift at Xbox, which includes a leadership reshuffle bringing several members from Microsoft's CoreAI team to the gaming platform. "As part of this shift, you'll see us begin to retire features that don't align with where we're headed," she said.

AI integration

Microsoft's effort to integrate AI into its products

Copilot on Xbox was part of Microsoft's effort to integrate AI into its products. The gaming-specific Copilot, which was announced last year, was supposed to be available on current-generation consoles this year. However, Sharma's announcement has put an end to those plans. This also aligns with her commitment to avoid "AI slop," despite her background as an AI executive at Microsoft.

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Leadership changes

Leadership changes at Xbox

Along with the Copilot update, Sharma also announced leadership changes at Xbox. "Xbox needs to move faster, deepen our connection with the community, and address friction for both players and developers," Sharma said. One of the most notable additions is Jared Palmer, former VP at Microsoft's CoreAI team, who will now serve as VP of engineering & technical advisor to CEO at Xbox.

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