June 18 - Microsoft (MSFT, Financial) and Advanced Micro Devices (AMD, Financial) have entered a multi-year collaboration to jointly develop custom chips for a range of devices, including the next wave of Xbox consoles, according to a Tuesday press release.
The companies plan to co-engineer silicon to power a broader gaming ecosystem, spanning traditional consoles to handheld devices. The partnership builds on their prior work, with AMD having supplied chips for earlier Xbox and PlayStation models.
Xbox president Sarah Bond said the next-generation Xbox will support a flexible hardware lineup and won't be limited to a single game store. She emphasized that the aim is to offer a seamless experience across devices while preserving backward compatibility with existing Xbox games.
Microsoft recently introduced the Xbox Ally and Ally X handhelds, developed with ASUS, with a release expected later this fall. The new devices allow access to the Xbox library on the go and support cloud gaming.
The moves are part of Microsoft's strategy to broaden its gaming reach beyond consoles, with a stronger focus on Game Pass and cloud-based services.
The company has also expanded game access to competing platforms and is working to open its devices to third-party stores, starting with its Ally line.
Microsoft's gaming revenue, housed under its More Personal Computing segment, totaled $13.37 billion in the third quarter, with Xbox content and services growing 8% year over year.
