Microsoft Corp. (MSFT) has entered a multi-year strategic partnership with Advanced Micro Devices, Inc. (AMD) to co-develop custom chips for its product lineup, including next-generation Xbox consoles.

Microsoft has officially confirmed that the next-generation of Xbox consoles is in the works and it's more than just a new box under your TV.

The next generation of the Xbox video game console will use AMD silicon. More pertinently for this publication, the Xbox will be available over Microsoft's growing cloud gaming service, requiring the new AMD chip to be on Microsoft Azure.