The video games arm of Microsoft is due to launch its next console, known as Project Scarlett, next year and is also preparing to introduce its games streaming service, Project xCloud later this year.
However, Xbox head Phil Spencer has denied reports that the company was working on a physical, streaming-only device to go with the xCloud service, which will allow gamers to play console titles on mobile devices.
“We are not working on a streaming-only console right now,” he told website Gamespot.
“We are looking at the phone in your pocket as the destination for you to stream, and the console that we have allows you to play the games locally.”
Earlier this year, Xbox released a disc-less version of the Xbox One S, which required users to download games from an online store rather than buy discs which are then inserted into it.
Mr Spencer argued that the company’s discussion of a streaming service, confirming it was working on new consoles and then launching that disc-less console may have caused the rumours.
“Last year we talked about xCloud and then we said we were working on new game consoles, but that’s all I said,” he said.
“We didn’t say that (a streaming console was being developed).”
The gaming giant has said the Project Scarlett device will be the most powerful console it has ever made and will reportedly be four times more powerful than the current generation Xbox One X.
Only one game has been confirmed launch title for the device so far, a new instalment in the popular Halo series, named Halo Infinite.