Microsoft is planning to release a next-generation Xbox handheld device in late 2027 followed by a high-end console in late 2028, according to a Fortune profile of Xbox Chief Executive Asha Sharma. The internal roadmap also outlines potential retail prices reaching up to $1,800 for the flagship system, alongside internal friction over software and an ongoing corporate restructuring.
A two-stage hardware rollout
The upcoming console hardware, developed under the codename Project Helix, is intended to debut during the 2028 holiday shopping season, Fortune reported. That release would follow a dedicated portable gaming machine scheduled for the 2027 holidays. It remains undetermined whether the planned handheld will be an in-house Microsoft product or developed through an original equipment manufacturer, similar to previous collaborations with Asus.
Sharma previously referred to Project Helix as a broader family of devices rather than a standalone piece of hardware. The plans build upon a multi-year partnership announced last year between Microsoft and chipmaker AMD to supply processors across a range of next-generation gaming hardware. Reports indicate the primary Project Helix console is engineered to operate both traditional console software and personal computer titles, with initial development kits expected to reach developers in early 2027, according to Windows Central.
Sticker shock and internal disputes
Internal financial modeling at Microsoft suggests the Project Helix home console could arrive with an unprecedented price tag. Fortune reported that the company currently projects the hardware could cost consumers between $1,200 and $1,800 at retail unless Microsoft decides to heavily subsidize manufacturing costs. Analysts note that surging component expenses, especially for memory chips driven by demand across the artificial intelligence sector, have escalated production projections across the computing industry.
The hardware plans also triggered sharp internal divisions over software. Teams from Microsoft’s Windows and Xbox divisions clashed over the operating system meant to power the upcoming lineup, according to Fortune. Windows executives pushed for a modified desktop configuration, while Xbox leadership insisted on a tailored operating system designed strictly for a dedicated gaming interface.
According to reporting from Windows Central citing Fortune, the dispute escalated until a senior Xbox official threatened to cancel the handheld initiative entirely rather than adopt the standard Windows build. Xbox leadership has since secured control over the operating system environment for the upcoming hardware.
Game Pass revamp and staffing cuts
Beyond hardware development, Microsoft is considering structural shifts to its Xbox Game Pass subscription platform. Internal proposals under review involve offering à la carte options, permitting subscribers to pick specific features such as cloud streaming, online multiplayer access, or console-exclusive libraries. The considerations come after Sharma rolled back earlier price increases for the service and removed future Call of Duty releases from day-one subscription access after determining the platform had grown too costly for consumers.
The long-term roadmap unfolds against a backdrop of continued workforce reductions across Microsoft’s gaming division. Fortune reported that Sharma is preparing another wave of Xbox layoffs this month, with subsequent cutbacks scheduled to take place in November and January as the brand works to expand beyond its current base of 100 million daily active users toward a broader long-term audience.
