A new report reveals Microsoft's ambitious plans for the future of video game hardware. The report alleges a next-generation Xbox console, slated for release in 2027, is currently in full production. Furthermore, an Xbox-branded handheld gaming device is reportedly planned for late 2025.
Windows Central, citing sources, details a partner PC gaming handheld codenamed "Keenan," targeting a late 2025 release. This device is distinct from a first-party Xbox handheld, which Microsoft's Phil Spencer has indicated is still several years away. Meanwhile, the next-gen Xbox, a premium successor to the Xbox Series X, has reportedly received the green light from CEO Satya Nadella. This console, along with a first-party handheld and new controllers, will complete Microsoft's 2027 console lineup. The report suggests no direct successor to the Xbox Series S is planned, possibly indicating the handheld will fill that market segment.
Microsoft executives have alluded to these plans in previous interviews. In January, Jason Ronald, VP of ‘Next Generation,’ discussed combining Xbox and Windows experiences for PC gaming handhelds developed by OEMs like Asus, Lenovo, and Razer.
Windows Central anticipates the next-gen Xbox will have a more PC-like architecture than previous models, supporting third-party storefronts such as Steam, the Epic Games Store, and GOG, while maintaining backwards compatibility. This aligns with Xbox president Sarah Bond's statement last year about Microsoft's commitment to a "biggest technological leap ever in a generation" for its next-generation hardware.
The future of the console market is subject to much speculation. The Xbox Series X and S are reportedly underperforming in the market, and Sony has hinted at the PlayStation 5 entering its second half of its lifecycle. While Nintendo is preparing the Switch 2, concerns are growing about the viability of the traditional console business model. Phil Spencer has acknowledged the lack of meaningful growth in the console market in recent years, citing a large but stagnant user base focused on a few major titles. However, this latest report indicates Microsoft's belief in the continued relevance of consoles.
