Microsoft (MSFT) stock was down on Tuesday alongside a rumor that Xbox canceled a first-party handheld console. According to tech leaker KeplerL2, Microsoft refused to sign an agreement with Advanced Micro Devices (AMD) that would have resulted in the creation of a handheld Xbox device.
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According to this rumor, AMD wanted a commitment of 10 million units before it would develop a System-on-a-Chip (SoC) for the handheld Xbox. Microsoft was reportedly unwilling to agree to such a large number as the demand for a handheld Xbox wasn’t likely to reach those levels. This is based on other popular handheld gaming PCs not achieving that number, such as the Steam Deck with its roughly 5 million in unit sales.
This likely helps explain why Microsoft turned to Republic of Gamers for its handheld Xbox. The ROG Xbox Ally is a collaboration between the two companies that brings the Xbox brand to the handheld PC market. This device will be released later this month for $599.99, with the enhanced ROG Xbox Ally X version priced at $999.99. The company recently denied a rumor that it would exit the physical console market.
Microsoft Stock Movement Today
Microsoft stock was down 0.67% on Tuesday but was still up 25.25% year-to-date. The company’s shares have also climbed 27.46% over the past 12 months. Traders will note that MSFT stock has gained in 2025 alongside the ongoing AI boom and not necessarily due to performance from its Xbox division.
Is Microsoft Stock a Buy, Sell, or Hold?
Turning to Wall Street, the analysts’ consensus rating for Microsoft is Strong Buy, based on 14 Buy and a single Hold rating over the past three months. With that comes an average MSFT stock price target of $628.05, representing a potential 19.73% upside for the shares.
