Microsoft unveils Xbox gaming handheld launching in 2025 (updated with hands-on)

Microsoft announced that it is diving into the handheld gaming market with its own Xbox-branded handheld in partnership with PC maker Asus.

It’s called the ROG Xbox Ally (16GB) and ROG Xbox Ally X (24GB). It has Hollow Knight game available at launch. Shawn Yen, vice president of consumer at Asus, said that Ally is short for “all your games.”

“We think this body is the soul of Xbox,” Yen said, in a briefing. It has the Windows OS, a full Xbox screen experience, and Armoury Crate SE as a central hub for device management. It’s quick access for power settings and more — all in one place.

“The Xbox experience grows with you,” said Sarah Bond, president of Xbox, in the Xbox Showcase.

The company plans to launch the handheld in 2025. As such, it will compete with rivals such as the Nintendo Switch 2 and the Valve Steam Deck. There are already a number of Windows-based devices on the handheld PC market, but those have had mixed results. This one promises the power of an Xbox experience in your hands. It has a seven-inch IPS VRR screen.

The move could inspire both fear and derision, as the prospect for such a move has done in the past. Microsoft considered launching an “Xboy” handheld back in the early days of the Xbox. But the dual challenge of taking on Nintendo’s GameBoy/DS franchises in handheld at the same time it was trying to beat the console makers was too daunting and Microsoft shelved the project.

“This is an Xbox,” Microsoft said in its show.

The device looks like an Asus ROG Ally but it has an Xbox button on it. The Ally has an AMD Ryzen Z2A, 16GB of memory, and 512GB of storage with 60 watt hours of battery life. The Ally X has an AMD Ryzen Z2 Extreme, 24GB of memory and 1TB of storage with 80 watt hours of battery life. The colors of the buttons are the same. It has 1080p, 120Hz refresh rate and HDR.

It has an Xbox controller configuration. You can download natively and stream from the Xbox cloud. It runs Windows and it has impulse triggers. It is coming in the holidays of 2025. You can now take your library with you anywhere, Bond said.

It has up to RTX 5090 Laptop GPU, with XG Mobile, which is the ultimate dock for the device, Yen said. It has a contoured touch to match the natural curves of your hand. It has balanced pressure distribution, which reduces the perceived weight for longer and more comfortable play. The impulse triggers bring immersive haptics to life.

Roanne Sones said it is “a big deal” to work with Asus, a third party, on hardware. She is the corporate vice president of gaming devices ecosystem at Xbox — and presumably had to make this decision. The retailers and publishers came back unanimously and said Microsoft should team up with Asus.

“We’ve got to pull all this together into a simplified user experience with the versatility of Windows,” Sones said, regarding the mission.

It has familiar Xbox touches with the thumbsticks, buttons, impulse triggers and grips, she said. The company was able to move faster by going with Asus. The Rzyen Z2A balances power, performance and price, Sones said.

Jason Beaumont, vice president of experience at Xbox, said players told the company they wanted a more streamlined experience than the Windows interface for games. It’s a full screen experience. Things like task bar and other things not related to games don’t load upon booting the Xbox full screen experience.

Players can get quick access to an aggregated game library from PC storefronts like Xbox, Game Pass, Battle.net and more, Beaumont said. The Play Anywhere experience enables things like Xbox Cloud Gaming or Remote Play on the device. You can access your full Xbox console library, and a program will tell players if the games have been optimized for handhelds.

From early testing, the team found that when it put the device to sleep while playing, it uses a third of the power. You can wake it up immediately. The Xbox button takes you out of a game and straight back to Home or the Library.

“It’s our Xbox experience reimagined for handheld,” said Dominique Gordon, senior product manager lead in a briefing. “It’s about putting gaming front and center.”

I played Gears of War: Reloaded on the handheld and it worked pretty easily. The Xbox controls worked pretty seamlessly, and the team demoed how you could broadcast the game from the device to a big screen TV.