Next-Gen Xbox Launching 2027, Handheld in 2025

A new report has shed light on Microsoft's ambitious plans for its video game hardware, suggesting a full next-generation Xbox is slated for release in 2027, while an Xbox-branded gaming handheld is 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 release, and the successor to the Xbox Series X and S is now in "full" production, set to launch in two years.

Microsoft has yet to officially comment on the report, but 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 manufactured by original equipment manufacturers (OEMs) like Asus, Lenovo, and Razer. However, Keenan is not a first-party Xbox handheld; Phil Spencer, Microsoft's gaming boss, has suggested that such a device is still years away.

Xbox Games Series Tier List

The next-gen Xbox, reportedly given the green light by Microsoft CEO Satya Nadella, is described as a premium successor to the Xbox Series X. This console, along with a first-party Xbox gaming handheld and new controllers, is expected to complete 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, possibly positioning the upcoming handheld to fill the niche for a more affordable, less powerful gaming option.

Windows Central suggests that the next-gen Xbox will be more akin to a PC than any previous Xbox, supporting third-party storefronts like Steam, the Epic Games Store, and GOG, and maintaining backwards compatibility. Last year, Xbox president Sarah Bond emphasized that Microsoft is "moving full speed ahead on our next generation hardware, focused on delivering the biggest technological leap ever in a generation."

The future of video game 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 latter half of its life cycle. Meanwhile, Nintendo is preparing to launch the Switch 2 later this year, raising concerns about the viability of the traditional 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, leaving less room for other games. Last year, former Xbox executive Peter Moore discussed with IGN whether consoles have a future. This latest report indicates that Microsoft believes they do, and is actively planning for it.