Microsoft Is Working On An Xbox Handheld Device But Won't Launch Before 2027

Microsoft has confirmed that it is working on prototypes for an Xbox handheld console, signaling a potential new direction in the company’s gaming hardware strategy. In a recent Bloomberg interview, Phil Spencer, Microsoft's Gaming CEO, revealed that while the console is under development, it will likely take a few years before it reaches the public.

However, a handheld console marks a significant shift in the gaming hardware strategy for the company, potentially entering the handheld gaming industry for the first time.

Spencer also stated that the company is currently focusing on enhancing its Xbox app performance on existing devices before launching new hardware anytime soon. He described the current Xbox app performance on portable devices as “good rather than great," indicating the probability of more improvement.Furthermore, he stated that the team is “informed by learning" from existing market leaders like Nintendo Switch and Valve Steam Deck, suggesting that the Xbox Handheld might take cues from these gaming devices.

Unlike market leaders like Sony and Nintendo, which have a history with portable gaming devices, Microsoft has often prioritised home consoles and PG Gaming. However, the Xbox handheld may represent a shift in that strategy, providing a fresh way to compete in the portable gaming industry.

“To reach new audiences, we need to be creative and adaptive of new business models, new devices and new ways of access," Spencer said. While criticising high-cost gaming hardware, he added “We're not going to grow the market with USD 1,000 consoles."

He also shared that Microsoft could also plan to collaborate with hardware manufacturers to optimize Xbox experiences, assuring seamless connectivity and synchronisation across devices.

Earlier this year, the tech giant unveiled its three new Xbox Series S/X console options during the Xbox Games Showcase which includes a 1TB SSD storage variation of the Xbox Series S in Robot White, an all-digital Xbox Series X and a 2TB Xbox Series X Special Edition in Galaxy Black.

The new Xbox Series X consoles feature certain internal hardware upgrades such as a more power-efficient 6nm processor and a reworked motherboard and cooling system. Announced in June, these devices arrived in the market for purchase in October this year.