Xbox Ally in great demand, ASUS expects to make up to $160 million from handhelds

ASUS says demand for the ROG Xbox Ally X exceeds expectations--the handheld is doing so well that it could make up to $160 million revenue in the quarter.

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ASUS' latest Q3 results show that Xbox's handheld aspirations are off to a good start. The Xbox ROG Ally and Ally X gaming handhelds launched in October to strong consumer demand, ASUS says, with the higher-priced $999 Xbox Ally X being surprisingly popular. ASUS believes there's a growing market for gaming handhelds and says the Ally will remain a core part of the ROG lineup.

As far as sales go, ASUS didn't give out unit sales but the company did say it expects to make anywhere from 3-5 billion TWD ($96-160 million) from ROG Ally sales during the holiday quarter. ASUS actually expects the bottom-line sales revenue to grow to roughly $130 million as the market continues to grow and mature. Remember that this is just ASUS' share, and Xbox also gets a cut, meaning actual sales revenue for each device is higher than what's outlined here.

Here's what company management said about the ROG Xbox Ally and Xbox Ally X during the recent Q3 earnings call:

"As many of you know, we introduced the first generation ROG Ally a few years ago. Creating this new category, especially within the Windows ecosystem, has proven itself to be highly successful.

"We believe we have achieved our original goals in terms of premium positioning and creating a new growth driver in the gaming segment. And that's why we launched the third-generation ROG Ally last month--it featured a deeper collaboration with Xbox.

"Since its launch we see that the market response for it has been extremely positive. Particularly, there has been an appetite for the premium higher-end models that exceeded our expectations.

"In fact, these high-end variants are currently in short supply. We are working closely with key component suppliers to ramp up production and fill the demand gap that currently exists.

"Our goal is for the ROG Ally to remain a core pillar within the ASUS gaming portfolio, while also driving tangible revenue and profit growth for the company.

"For this quarter, currently we are expecting the sales contribution of the Ally to come in at around 3 to 5 billion TWD. Given the strong demand for the high-end models, we are confident that quarterly revenue could move toward the 4 to 5 billion TWD range going forward."