Xbox handheld put on hold to improve Windows 11 gaming on third-party devices

If you’ve been hoping for a native Xbox handheld, this news won’t please you. While previous reports suggested that a native Xbox handheld was in the works but it seems now Microsoft has put that project on hold.

According to a new report from Windows Central, Microsoft was working on its own Xbox-branded handheld device. It was supposed to be native—designed in-house and aimed to rival the Steam Deck and other Windows-powered gaming portables.

Design-wise, it would’ve carried the Xbox designs, with rumors hinting at a release sometime in 2025. But Microsoft appears to have changed the course. As Microsoft holds its internal Xbox handheld project, it has turned its attention elsewhere.

The report claims that Microsoft is now heavily involved in ASUS’s upcoming gaming handheld, codenamed Project Kennan. This collaboration is partly strategic. SteamOS-based devices like the Steam Deck are killing it in terms of power efficiency and performance. Windows 11 handhelds? Not so much.

So instead of rushing its own hardware, Microsoft is using Project Kennan to take the Windows gaming experience on portable devices up one notch. Think smoother performance, better battery handling, and a polished Xbox app.

Project Kennan is reportedly launching later this year. The hardware is mostly locked in, but Microsoft and ASUS are still refining the software. And no, Microsoft hasn’t abandoned its Xbox handheld dream. It’s just waiting.

The feature image is generated using Microsoft Designer