From a purely logical standpoint, Asus as a hardware partner makes a lot of sense given it already has the ROG Ally, which is a fairly robust Windows 11 handheld PC that can run games in the Xbox Game Pass PC catalog both natively and via cloud-powered streaming.

A flurry of new details about Microsoft's Xbox handheld have emerged. Leaks have revealed the OEM, the target price, and more.

Those rumors about Microsoft making it own Xbox handheld may have been hasty, but we could see the Xbox version of SteamOS instead.

I understand the Xbox work that has hit the headlines this week is actually called Project Kennan, not Keenan. I’m told that Kennan is the codename for a handheld that is being manufactured by Asus, and it’s part of a larger effort from Microsoft to unify Windows and Xbox towards a universal library of Xbox and PC games.

The Asus ROG Ally, along with its premium sibling, the Asus ROG Ally X, stand among the best handheld gaming consoles you can get, so Microsoft would do well to partner up with the company for a new handheld device — especially if it comes with an all-new OS platform that caters to Xbox.

New Xbox handheld reports say Asus, the creator of the ROG Ally line of handheld gaming PCs, is partnering with Microsoft on the project.