Microsoft plans to launch an Xbox next-generation handheld device for the holiday season of 2027, followed by a home console codenamed Project Helix in late 2028. Internal projections suggest the Helix console could cost between $1,200 and $1,800 unless subsidized, as hardware costs mount and software strategy changes occur under Xbox CEO Asha Sharma.
Project Helix Faces High Pricing Projections
Microsoft is internally projecting that its next-generation home console, known under the codename Project Helix, will carry a retail price between $1,200 and $1,800 unless the company chooses to absorb part of the manufacturing expense. That estimated price tag would position the console far above traditional hardware costs, bringing it closer to high-end gaming PCs.
Asha Sharma is overseeing an engineering push that has pressured the hardware team to move up timelines by at least several months, in part by using AI tools where applicable to solve engineering and performance problems.
A new report claims that Microsoft is working on an Xbox handheld for 2027, followed by an Xbox Helix console in 2028 that could cost between $1,200 and $1,800.https://t.co/p1gZTI481GMore interestingly, the report suggests the Windows and Xbox teams have clashed over the…
Windows and Xbox Division Clash Over Handheld Software
Before Project Helix arrives in stores, Microsoft is preparing to release a next-generation handheld device by the 2027 holiday season.
This rollout follows earlier collaborations with Asus on ROG Ally devices where Xbox teamed up with Asus for its Xbox Ally devices running a modified version of Windows 11 with an Xbox mode enabled, but the upcoming handheld is positioned as part of a family of devices under Sharma’s leadership.
Development of the software underpinning these new platforms has triggered internal friction between Microsoft’s Windows division and the Xbox team. Windows leaders wanted an upcoming handheld device to use a trimmed-down version of Windows Home. In order to achieve optimal gaming performance, however, Sharma’s group has worked to develop and manage its own proprietary software.
According to reports, the dispute escalated to the stage where a high-ranking Xbox official warned the handheld project would be cancelled instead of taking on that particular Windows operating system build. Sharma emphasized the two still collaborate closely, saying, We can’t build Helix on our own.
Xbox Shifts Game Pass to Tiered Structure
Alongside hardware changes, Xbox is overhauling its subscription services. Current reporting indicates that Game Pass will soon shift to a heavily tiered a la carte structure letting subscribers pick and choose add-ons for console-only games, cloud gaming, and multiplayer.
According to a report from Fortune, #ProjectHelix could be pricier than expected, around $1200-$1800 USD. Plus, we'll likely see the console release by "Christmas 2028". 🎄 Source: GamesRadar | Learn More: https://t.co/pjpVZmlnvk pic.twitter.com/mYtQxux9VE
The gaming business has generated roughly $21 billion in revenue while a Microsoft measure of the division’s profit margin has reportedly hovered around 3%. Although Judson Althoff dismissed rumors that Sharma was hired simply to drive severe reductions ahead of an upcoming divestment or sale of the Xbox division—noting that they would not place her in charge of a business they plan to offload—Sharma is preparing another wave of Xbox staff reductions this month, with additional cuts scheduled for November and January.
Market Realities Push Up Console Prices
The steep financial projections for Project Helix reflect macroeconomic realities facing the entire home console market. Competitors face similar component cost burdens, with recent rumblings that Sony’s PS6 RAM and storage alone cost over $680, pushing that rival machine toward a $1,000+ price point.
In the United States, Microsoft implemented price increases on current Xbox consoles effective August 1, 2026, raising prices by $100 for 512GB versions and $150 for 1TB models.
Xbox reportedly intends to release its next-generation console in 2028 Xbox reportedly projecting the console to cost $1,200 – $1,800, unless the company subsidizes some of the cost Source: Fortune Magazine pic.twitter.com/vtIAU2FKVh
Whether Microsoft will ultimately subsidize the Project Helix price tag or proceed with internal job cuts remains unknown.