Xbox is reportedly set to release its first handheld gaming device later this year.
The next generation of the classic Xbox console also has a release timeline of 2027.
Windows Central’s Jez Gordon reported that Microsoft is said to be working on the newest project with a PC gaming original equipment manufacturer (OEM) - which one is still unclear, but it could be the likes of ASUS, Lenovo, MSI, Razer, etc.
Codenamed "Keenan", the gaming handheld is expected to have a familiar "Xbox" look complete with an official Xbox guide button, and Xbox design sensibilities.
According to Gordon, the partner device is also likely to be more PC-oriented, almost definitely running full Windows, with the Microsoft Store and PC Game Pass front and centre.
He suggests the device will also likely serve, at least in part, as a research experience for Microsoft to test new Windows 11 "device aware" capabilities.
Gordon has all but confirmed the legitimacy of the new products as sources indicated that Microsoft's Xbox Series X|S platform has been fully greenlit from as high up as CEO Satya Nadella.
The latest Xbox consoles are also said to be closer to Windows than ever before, which will reduce the amount of work developers have to commit when porting from PC.
AI will likely have a role to play next-gen, as well as Xbox cloud capabilities, predicts Gordon.
This comes a few months after details on the company's financial results for the second quarter of fiscal 2025, revealed that gaming revenue was down 7% year-over-year for the quarter ending 31 December, 2025.
The quarter did however see Xbox content and services revenue up 2%, to which the company credits growth in Xbox Game Pass.
Xbox hardware revenue declined 29% year-over-year.
At the time of writing, Microsoft Corp (NASDAQ: MSFT) shares were trading at US$380.16 down 3.34% from the previous day’s close. The stock reached a day high of $386.40 and a day low of $377.22. Microsoft has a market capitalisation of $2.83 trillion.
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