A recent report has shed light on Microsoft's ambitious plans for its video game hardware, revealing a full next-generation Xbox slated for release in 2027 and an Xbox-branded gaming handheld expected to hit the market later in 2025. According to Windows Central, a partner PC gaming handheld, codenamed Keenan, is in development for a late 2025 launch. Additionally, a successor to the Xbox Series X and S, now fully in production, is scheduled to debut in two years.
Although Microsoft has not officially commented on these reports, its gaming executives have hinted at these developments in various interviews. In January, Jason Ronald, Microsoft's VP of 'Next Generation,' shared with The Verge that the company aims to integrate Xbox and Windows experiences for PC gaming handhelds manufactured by original equipment manufacturers (OEMs) like Asus, Lenovo, and Razer. It's important to note that Keenan is not a first-party Xbox handheld, as Phil Spencer, Microsoft's gaming boss, suggested that a true Xbox handheld is still years away.
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Windows Central also stated that the next-gen Xbox has received full approval from Microsoft CEO Satya Nadella. This upcoming console is expected to be a premium successor to the Xbox Series X. Alongside this, Microsoft plans to release a first-party Xbox gaming handheld and new controllers, aiming to complete its console lineup by 2027. Interestingly, there appears to be no direct next-gen successor planned for the less powerful Xbox Series S, suggesting that the handheld may serve as Microsoft's entry into the more affordable console market.
The next-gen Xbox is anticipated to be more akin to a PC than any previous Xbox, with support for third-party storefronts like Steam, the Epic Games Store, and GOG. Continued backwards compatibility is also expected. Last year, Xbox president Sarah Bond emphasized Microsoft's commitment to "moving full speed ahead on our next generation hardware, focused on delivering the biggest technological leap ever in a generation."
Amidst speculation about the future of consoles, the Xbox Series X and S are reportedly struggling in the 'console war,' while Sony has indicated that the PlayStation 5 is entering the second half of its lifecycle. Nintendo is preparing to launch the Switch 2 later this year, raising concerns about the sustainability of the traditional video game console market.
Phil Spencer has noted in interviews that the console market has not seen significant growth in recent years, with a static customer base increasingly focused on a few major titles. Last year, former Xbox executive Peter Moore discussed with IGN the possibility of Microsoft contemplating the future viability of consoles. However, based on the latest report, it appears Microsoft remains committed to the console business.
