A recent report has shed light on Microsoft's ambitious plans for its video game hardware, revealing that a next-generation Xbox is slated for release in 2027, with an Xbox-branded gaming handheld expected to hit the market in late 2025. According to Windows Central, a partner PC gaming handheld codenamed "Keenan" is in development for a 2025 launch, while the successor to the Xbox Series X and S is now "fully" in production and scheduled for release in two years.
Microsoft has yet to officially comment on these reports. However, its gaming executives have hinted at these developments in various interviews. In January, Jason Ronald, Microsoft's VP of 'Next Generation,' told The Verge that the company aims to integrate Xbox and Windows experiences for PC gaming handhelds produced by original equipment manufacturers (OEMs) such as Asus, Lenovo, and Razer. It's important to note that "Keenan" is not a first-party Xbox handheld; Microsoft gaming boss Phil Spencer has indicated that a true Xbox handheld is still years away.
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Windows Central also reported that the next-gen Xbox has received full approval from Microsoft CEO Satya Nadella. This upcoming console is poised to be a premium successor to the Xbox Series X and will be accompanied by a first-party Xbox gaming handheld and new controllers, completing Microsoft's console lineup by 2027. Interestingly, Microsoft does not seem to be planning a direct next-gen successor to the less powerful Xbox Series S, potentially leaving that market segment to be filled by the new handheld.
The next-gen Xbox is expected to resemble a PC more than any previous Xbox model, with support for third-party storefronts such as Steam, the Epic Games Store, and GOG. Backwards compatibility is also expected to be a feature. 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."
The future of consoles is a topic of much speculation. The Xbox Series X and S are struggling in the 'console war,' and Sony has hinted that the PlayStation 5 is entering the second half of its lifecycle. Meanwhile, Nintendo is gearing up to launch the Switch 2 later this year, amidst growing concerns about the viability of the traditional video game console market.
Phil Spencer has noted that the console market has not grown significantly in recent years, serving a sizable yet stagnant customer base that predominantly engages with a few blockbuster titles. Last year, former Xbox executive Peter Moore discussed with IGN whether consoles have a future at all. This latest report suggests that Microsoft firmly believes they do.
