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Microsoft's exciting multi-year silicon partnership with AMD doesn't actually make it clearer if there's an official Xbox handheld or next-gen console coming

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Will next-gen Xbox hardware be made by Microsoft, by someone else, maybe both?

An ROG Xbox Ally X and Ally shown during Microsoft's Xbox stream in June 2025.
(Image credit: Microsoft)

So, Microsoft has announced it's teaming up with—or maybe that should be sticking with—AMD for its next generation of Xbox hardware. But what does that actually mean for conventional Xbox consoles and the new trend of handhelds?

Perhaps the key line from Xbox President Sarah Bond in the YouTube video announcement goes thus: "We've established a strategic multi-year partnership with AMD to co-engineer silicon across a portfolio of devices, including our next-generation Xbox consoles in your living room and in your hands."

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Are Microsoft-made devices the future or the past for Xbox? (Image credit: Xbox)

The simplest answer may be that "our next-generation Xbox consoles in your living room and in your hands" really means those third-party devices, not consoles and handhelds made by Microsoft. What's hard to imagine, even allowing for clumsy language, is that a "portfolio" of devices just means a Microsoft-made living console plus a handheld.

Surely it means more than that, and surely the Asus ROG Xbox Ally and Ally X handhelds signal that broader ecosystem of Xbox consoles, too. All the while, there's absolutely no indication of what "co-engineering silicon" will mean in practice.

Microsoft already does that with its existing Xbox Series S and X consoles, of course. So, is that anything new? In the end, we'll have to wait and see what Microsoft says and does in future. Because this announcement ultimately raises far more questions than it answers.

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