According to a new report from Jez Corden of Windows Central, Microsoft is working to launch an Xbox-branded handheld later in 2025.

Microsoft is reportedly collaborating with an original equipment manufacturer (OEM) to release an Xbox-branded handheld gaming device later this year. Codenamed “Keenan,” this device is expected to feature recognizable Xbox design elements, including the official Xbox guide button. This move signifies Microsoft’s initial foray into the handheld gaming market, following expressions of interest from CEO Phil Spencer.

“Given that this is a partner device, similar to Lenovo’s SteamOS partnership with Valve, I expect this handheld to be more PC-oriented,” Corden says. “It’ll most likely run full Windows, putting the Microsoft Store and PC Game Pass front and centre, alongside the ability to install things like Steam.”

Looking further ahead, Microsoft plans to launch next-generation Xbox consoles in 2027, succeeding the current Xbox Series X/S models. These consoles are anticipated to offer enhanced performance and new features, continuing Microsoft’s commitment to gaming innovation.

These developments highlight Microsoft’s strategy to expand its gaming hardware portfolio, entering the handheld market while also preparing for the next generation of console gaming.

What do you think of Microsoft working on launching an Xbox gaming handheld this year? Is it something you’ll pick up?