A recent report has shed light on Microsoft's ambitious plans for its video game hardware, suggesting a full next-generation Xbox console is slated for release in 2027, and an Xbox-branded gaming handheld is expected to launch in late 2025. According to Windows Central, a partner PC gaming handheld codenamed "Keenan" is currently in development for a late 2025 release, while the successor to the Xbox Series X and S is already "fully" in production and set to hit the market in two years.
Although Microsoft has not officially commented on these reports, its gaming executives have hinted at the development of both devices in various interviews. In January, Jason Ronald, Microsoft’s Vice President of ‘Next Generation,’ told The Verge that the company aims to integrate Xbox and Windows experiences into PC gaming handhelds manufactured by original equipment manufacturers (OEMs) such as Asus, Lenovo, and Razer. However, Keenan is not linked to a first-party Xbox handheld, which Microsoft gaming boss Phil Spencer suggested is still years away.
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Windows Central also revealed that the next-gen Xbox has received full approval from Microsoft CEO Satya Nadella. This upcoming console, described as a premium successor to the Xbox Series X, will be accompanied by a first-party Xbox gaming handheld and new controllers, completing Microsoft's console lineup in 2027. It appears Microsoft will not be releasing a direct next-gen successor to the less powerful Xbox Series S, possibly positioning the handheld to fill the role of a more affordable, less powerful console.
The next-gen Xbox is expected to resemble a PC more than any previous Xbox model, supporting third-party storefronts like Steam, the Epic Games Store, and GOG, while continuing to offer backwards compatibility. Last year, Xbox president Sarah Bond emphasized Microsoft's commitment to advancing its next-generation hardware, aiming for the largest technological leap ever in a generation.
Amidst ongoing speculation about the future of gaming consoles, the Xbox Series X and S are reportedly struggling in the 'console war,' and Sony has indicated that the PlayStation 5 is entering the latter part of its lifecycle. Meanwhile, Nintendo is preparing to launch the Switch 2 later this year. There is growing concern that the traditional video game console market may be facing challenges.
Phil Spencer has highlighted that the console market has not seen significant growth in recent years, with a static customer base increasingly focused on a few blockbuster games, leaving limited space for other titles. Last year, former Xbox executive Peter Moore discussed with IGN whether consoles have a future at all. However, based on this latest report, it seems Microsoft remains committed to the console business.
