"According to Schreier, his sources from within Microsoft and Xbox have told him that since 2023, Microsoft Chief Financial Officer Amy Hood has issued a demand that Xbox aims for 30% "accountability margins," a term used by Microsoft instead of profit margin. This, Jason says, is why Xbox has been cutting jobs, raising the price of Game Pass and shutting down studios."
"He does go on to say that his sources told him not every team is expected to hit these margins, "but many Xbox developers and groups have been presented with the new target." Schreier's sources also told him that prior to this, Xbox was not given any specific targets and "were largely told to focus on making the best games possible without worrying too much about finances.""
Since 2023 Microsoft Chief Financial Officer Amy Hood has demanded that Xbox aim for 30% "accountability margins." Many Xbox developers and groups have been presented with the new target, though not every team is expected to meet it. Xbox has responded with job cuts, Game Pass price increases, and studio closures. Before the mandate, Xbox reportedly had no specific financial targets and was told to prioritize game quality. Industry average profit margins have ranged 17–22% recently, while Xbox margins have typically been 10–20%, with a 12% margin reported in 2022. A 30% requirement is far above typical industry levels.
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