Microsoft Xbox’s project for its own dedicated Xbox-branded handheld console, expected to rival the ROG Ally, has been completely canceled due to a high sales commitment from hardware supplier AMD.

According to new details from an AMD source, AMD demanded a minimum sales commitment of 10 million units from Xbox to launch the portable console.

Xbox’s market concerns disrupted plans

Xbox management, assessing the sales figures of existing portable gaming devices, lost confidence in their ability to meet this commitment.

Despite being the largest player in the market, Steam Deck has yet to reach five million sales.
Sales of other PC-based handheld consoles, such as the ROG Ally and the Lenovo Legion Go, are even lower.
In light of this data, Xbox shelved the project without announcing the device, believing it would not meet its expected sales targets.

With its own dedicated console canceled, Xbox opted instead to partner with the ASUS ROG Ally. Xbox is preparing to release its branded ROG Xbox Ally X this month.

While it’s been confirmed that this premium model will retail for a hefty $999.99, at least Xbox isn’t obligated to sell 10 million units under this partnership. Interestingly, despite its high price, the near-instant sale of ROG Xbox Ally X pre-orders suggests that this partnership is proving to be a successful strategy for Xbox.

This development marks a rare piece of positive news for Xbox, which has recently been plagued by Game Pass price hikes and console stock issues.