Microsoft Reportedly Shifts Focus From Xbox Handheld to Windows 11 Handheld PC Gaming Optimization
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- Microsoft has shifted priorities to optimizing Windows 11 on PC gaming handhelds.
- The company is still developing its native Xbox handheld and the successor to Xbox Series X.
- Microsoft is expected to release a handheld that it worked with ASUS on later this year.
A report by Windows Central revealed that Microsoft is prioritizing Windows 11 PC gaming handheld optimization over the development of its native Xbox handheld and Xbox Series X successor. The report noted that SteamOS performing better on third-party devices may have been one of the reasons for the shift.
One of Windows Central’s sources reported that while Microsoft is still investing heavily in its Xbox gaming handheld, it’s being sidelined in favor of optimizing the Windows 11 PC gaming experience in OEM handhelds. An internal announcement stated that the company is “moving more deeply towards third-party OEM handhelds in the interim.”
This includes Project Kennan, the handheld device Microsoft is working on with ASUS. Windows Central noted that the hardware is essentially already complete, but work on the software side is still ongoing.
The existence of the handheld was first reported in March 2025. A leak followed earlier this month, when somebody was able to get their hands on the ROG Ally 2. The device featured an Xbox-branded button, suggesting that ASUS is working closely with Microsoft to integrate the console into the latter’s ecosystem.
Project Kennan is expected to be released in late 2025. The native Xbox handheld is slated for release in 2027. However, since it’s being reportedly sidelined, release dates might be moved. Windows Central noted that the development of the successor to the Xbox Series X remains at full pace.
