A new era has begun for Xbox following the launch of the ASUS ROG Xbox Ally and Ally X gaming handhelds, as folks wonder what’s next on the horizon. Both gaming handheld models were launched last week, on October 16, and have generally received positive reviews, although some have questioned the considerable price difference between the two. Xbox President Sarah Bond has provided some background regarding the $599.99 and $999.99 pricing for the new gaming handhelds while also addressing concerns that Microsoft could abandon development of its console line following months of rumors and speculation. To begin with, Bond clarified in an interview with Variety how the ball was always in ASUS’s court when it came to pricing.
“That is all of their insight into the market, into the feature set, into what people want, to determine the ultimate prices of the devices.”
Sarah Bond, Xbox President
Bond adds that “We sold out on the Xbox Store. We sold really quickly at a number of other places around the world,” and that “I feel really good about the value that we’re giving gamers for the price, based off the reception to the hardware.”
Microsoft, Xbox, and ASUS all worked together to create an Xbox experience using Windows 11 sans a keyboard and mouse. The teams focused on revamping the OS to use the controller and touchscreen for a seamless and optimized UI for the handhelds, where players would recognize a nearly identical interface as seen on the Xbox X|S. It should be noted that the Ally and Ally X do not natively run Xbox games but rather their PC counterpart versions or those streamed via Game Pass. Users can, of course, access Steam or other online services for more games as well.
All of this focus on the handhelds has left some wondering if Xbox will continue to make its own hardware. After all, it shouldn’t be forgotten how it was announced shortly after their initial reveal at Gamescom that Microsoft was pausing its in-house development for a gaming handheld to assist ASUS with its products. Shortly after that, Microsoft was rumored to have canceled its Xbox gaming handheld. Well, Bond is clear that Microsoft is still 100% fully committed to making new products in the future.
“We have our next-gen hardware in development. We’ve been looking at prototyping, designing. We have a partnership we’ve announced with AMD around it, so that is coming.”
Sarah Bond, Xbox President
Bond expands on this by explaining how Xbox saw an opportunity to offer Xbox gamers a new choice by offering the handhelds, and that next-gen hardware is still on the way. It also shouldn’t come as a surprise if Microsoft does choose to move forward in making an Xbox gaming handheld now that the waters have been tested and a number of pieces are now in place.
Discussion (11 replies)
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It would also be great if MS honchos can give some kind of roadmap / milestones etc.
Otherwise given their past history (R.I.P zune, windows phone et al), the sense of unease remains. Sad. But true.
On the first party handheld this is what happened
[*]Now this is what you have from microsoft
[*]Basically for handhelds, microsoft has gone all-in behind their AIB partners such as ASUS, Lenovo, MSI etc
[*]Microsoft's main focus with handhelds is valve steam deck & not Sony.
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So going first party handheld apu like PS6 canis will distract from microsoft's main focus of competing with valve
You can spin this however way you want
But I doubt if we'll ever see an first party true xbox handheld
This is on the desktop box console: it will be a very premium product
Our next gen console is going to be a A very premium, very high end, curated experience.
~Sarah Bond, Xbox Hardware Head Honcho
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I forget where but I was reading something over the weekend that they want to look past Sony/Nintendo and make something that can compete in the PC user space. Some folks said it sounded a bit similar to Steam Machines.
Right they are not competing with Sony or Nintendo anymore
But rather with valve & their Linux based gaming platform
So the next gen Xbox should have steam access & performance easily between 5070 ti & 5080 (basically a 5070 ti super, I'd guess)
So you can guess the price if it launches in 2027
Honestly, they need to release the next one as a set. A home unit that can do 4k with upscaling. And a hand held unit that you get remote play access to for the games you have on your home unit as part of a subscription. A effectively complete gaming bundle. At least that's my take.
I think that's a great idea. I don't think that would help Microsoft out.
Microsoft's issues are much deeper than just hardware.
Xbox King Phil Spencer Bows Out As Asha Sharma Grabs The Controller, Sarah Bond Exits
Spencer will stay on in an advisory role through the summer, while Xbox president Sarah Bond has chosen to leave the company.
Why the shake-up matters
The leadership shuffle follows a rocky period for Microsoft Gaming that has included multiple rounds of layoffs and studio closures over the past year, according to reporting by The Verge. Analysts also point to the choice of an AI product leader to run the division as a sign that Microsoft wants its gaming arm tightly aligned with the company’s broader AI and consumer-product strategy, as reported by Bloomberg. That alignment could reshape where Microsoft spends its gaming dollars and how it defines success in the coming years.
https://hoodline.com/2026/02/xbox-king-phil-spencer-bows-out-as-asha-sharma-grabs-the-controller/
Nadella's message to Microsoft execs: Get on board with the AI grind or get out
According to an internal memo, Nadella also started a weekly AI accelerator meeting and corresponding Teams channel to speed the pace of AI work and get more ideas from across the company.
Executives do not present in these new meetings. Instead, lower-level technical employees are encouraged to speak and share what they're seeing from the AI trenches. This is designed to avoid top-down AI leadership, and is intentionally a bit messy and chaotic, according to people familiar with the new approach.
Production function, explained
Asha Sharma, Microsoft CoreAI product president, who joined in 2024, said the company has shifted its operations dramatically in her short tenure. Nadella's new "production function" is about using AI to radically change how the company creates, builds, and delivers products and services.
When she joined, the AI industry would crank out a big new foundation model roughly every six months. Then, releases happened every six weeks. Today, AI is changing so quickly that it's forcing Microsoft to rethink not just its products but the entire way software is made, Sharma said in an interview arranged by the company.
For decades, software development has worked like an assembly line. You take a set of inputs — people, time, resources — and transform them into output. Scaling production required scaling those inputs.
"AI breaks that relationship," she said.
AI agents, data, and intelligence now act as a new type of scalable unit that can generate software, insights, and decisions without a corresponding increase in engineering hours or budget. That means the marginal cost of creating something new drops dramatically, Sharma explained, and teams can now spend more on "judgment, taste, and problem-solving."
https://www.businessinsider.com/microsoft-ceo-satya-nadella-ai-revolution-2025-12
the pressure is forcing some Microsoft veterans to decide whether they want to stay and commit to the mountain of work required.
"You've gotta be asking yourself how much longer you want to do this," the executive added. People familiar with the matter said Nadella is having direct conversations with executives to secure their commitment to the transformation or facilitate their departure.
Asha Sharma takes over immediately as CEO of Microsoft Gaming, bringing an unusual resume for a gaming executive. She spent the past few years heading development for Microsoft's AI enterprise teams, right in the thick of the company's ChatGPT integration push and enterprise AI buildout. Before that, she was COO at Instacart for three years, managing the grocery delivery giant's operations during its explosive pandemic growth. And before Instacart, she spent four years at Meta running the company's messaging apps including WhatsApp, Messenger, and Instagram Direct.
there's another angle worth considering. Sharma's operational background at Instacart and messaging experience at Meta suggests she knows how to scale platforms and manage massive user bases. Xbox Game Pass, Microsoft's Netflix-for-games subscription service, has been growing but hasn't hit the scale Microsoft hoped for. Someone with Sharma's background in subscription operations and user retention could be exactly what Game Pass needs.
The gaming industry's reaction has been mixed. Developers and Xbox fans are understandably nervous about an outsider taking the reins, especially one without a public track record in gaming.
https://www.techbuzz.ai/articles/microsoft-taps-ai-executive-asha-sharma-to-lead-xbox-gaming
he took the retirement decision exactly 1 month after this
Phil Spencer isn’t retiring as the chief of Xbox ‘anytime soon’
Spencer has headed up Microsoft’s Xbox efforts since 2014.
by Jay Peters and Tom Warren
Jul 3, 2025, 1:10 AM GMT+5:30
Microsoft says that Phil Spencer, Microsoft Gaming CEO and the head of Xbox, isn’t retiring “anytime soon.” The company has responded to rumors of Spencer’s retirement, which have spread online today following Microsoft’s major layoffs.
“Phil is not retiring anytime soon,” says Kari Perez, head of Xbox communications, in a statement to The Verge. The denial comes after Call of Duty leaker GhostOfHope claimed “Phil Spencer will be retiring from his role as CEO of Microsoft Gaming after the launch of the next generation Xbox” and that Xbox president Sarah Bond would be taking over as CEO of Microsoft Gaming.
While Microsoft’s comment doesn’t address the rumor fully, it makes it clear Spencer isn’t retiring imminently. Separately, Microsoft communications chief, Frank Shaw, took to X to claim that at least part of the rumor was made up.
https://www.theverge.com/news/696922/phil-spencer-xbox-microsoft-gaming-retiring
Probably a forced retirement.