The conversations at MSFT are most likely:
"Let's put out a press release saying we are investing another $500 million for our commitment to the product - this is a marketing issue and we have to responnd"
"Let's call Goldman's TMT guys and see if they can find a buyer or recommend the best time to spin off the unit and take as much cash as we can off the table"'
"Let's put that cash into Surface Pro 5 with 1.2 Teraflops and compatibility with all PC games and get Xbox One users to transition in a few years"
"Let's save one platform (Windows) that makes money and consolidate our users there, rather than dividing our users across two"
Microsoft doesn't innovate out of situations, it buys its way out or kills the whole project altogether.
There is tremendous pressure on the new CEO to make a decisive commitment to Windows and either double-down on saving it and perhaps forcing Xbox users onto Surface - or going all-in on Enterprise.
In either case the Xbox experiment doesn't have a high probability of surviving past this generation.
I'd agree with almost all of this, but I think the Xbox project will survive due to inertia.
They aren't going to sell Xbox to anyone as there's hardly anyone capable of buying it and running it bar Samsung and one or two other tech firms, and there's no reason that any of those firms would want a loss-making business in an area (under-TV box) no longer seen as mission-critical.
At the same time, I really feel like Xbox is too big to kill outright. Too many employees, and too much bad publicity among young men if you kill it.
So while it won't be any kind of priority, I think it'll limp along for the rest of the gen as best they can. When it comes to next gen, that will entirely depend on where we stand, and we can't see that yet. Xbox might become a service streamed to TVs from Surface tablets or something like that. I agree that we may never see a proper successor to Xbox, but far too much is left to play out to make any kind of prediction there.
I think the biggest point, though, is that Xbox was Microsoft's trojan into the living room, and the battle ended up shifting to people's pockets and personal screens. There's not much point in fielding an army to a battlefield you no longer believe is important.