While the world of gaming handhelds gets used to the idea of the Xbox-themed ASUS ROG Ally consoles, there was a point when Microsoft was reportedly set to create its own AMD-powered, dedicated handheld for the masses. The deal seemed feasible, up until AMD’s alleged and ridiculous demand from the Xbox owner.
According to the fresh round of rumours, AMD allegedly demanded that Xbox commit to producing 10 million units of its handheld, which is an absolutely ridiculous number. To Microsoft, this was an impossible task, let alone an impossible number to hit, at which point, the Xbox parent company just bowed out.

According to KeplerL2 and by comparison, Valve only sold five million units of the Steam Deck, while ASUS and Lenovo sold between one and two million units of their respective handhelds. Combined.
KeplerL2 does explain that because the Xbox gaming handheld was still very early in the development phase, it was easy for the gaming brand’s parent company to just cancel it before it went any further.
It’s no secret that Microsoft’s plans for its Xbox division haven’t quite gone to plan. For years, it has been facing a steep uphill battle against Sony and its PlayStation console, but its PC Game Pass has fared a little better, the recent price hike notwithstanding. On the subject of its console, the brand has rejected rumours that it is abandoning its hardware entirely, stating that it is “actively investing in our future first-party consoles and devices designed”.
We’re assuming the last part is in reference to its collaboration with ASUS and the ROG Ally Series that recently became available to preorder in Malaysia.
(Source: Insider Gaming, NeoGaf, TweakTown)