Xbox Handheld Reportedly Canceled Due to AMD’s High Minimum Order Demands

Microsoft’s long-rumored Xbox handheld console has reportedly been canceled due to AMD’s high minimum order requirements, according to recent claims circulating online. The rumor originated from a post on the NeoGAF forums by well-known AMD leaker Kepler L2, who has previously shared accurate details about AMD’s console and PC hardware. According to Kepler, AMD required Microsoft to commit to ordering more than 10 million units to justify the R&D investment needed for a custom SoC (System-on-Chip) specifically designed for the handheld.

Microsoft reportedly deemed that commitment too risky, particularly when compared to the current state of the handheld gaming market. The Steam Deck has sold approximately 5 million units, while the ASUS ROG Ally is estimated to have sold fewer than 2 million. With those figures in mind, Microsoft likely found AMD’s production requirements too high for what could be a niche product.

While Kepler L2’s track record lends credibility to the claim, these details should still be taken cautiously, as Microsoft has never officially announced an Xbox handheld. Without formal acknowledgment, it is unlikely the company will confirm or comment on the reasons behind any internal cancellations.

Still, the rumor aligns with Microsoft’s evolving business direction. The company has increasingly emphasized third-party publishing, expanding its presence across multiple platforms rather than focusing solely on exclusive hardware. Given that, committing to large-scale hardware production for a handheld might no longer fit Microsoft’s broader strategy.

Interestingly, handheld gaming remains a hot topic within the Xbox ecosystem. Executives have previously teased the concept of a portable Xbox experience, and Microsoft is now partnering with ASUS on the upcoming ROG Ally Xbox Edition, launching October 16. Despite its premium pricing, the device has already sold out in many regions ahead of release, suggesting strong demand among enthusiasts.

The cancellation of the rumored handheld may not mark the end of Xbox’s portable ambitions but rather a shift in how the company approaches handheld gaming, possibly leaning on partnerships and platform integration rather than proprietary hardware.

Would you have bought an Xbox handheld if Microsoft had released one? Or do you think partnering with ASUS on the ROG Ally is the smarter move?