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Project Scorpio is a new Xbox with upgraded 4K graphics, coming 2017

A smaller Xbox One isn't the only piece of hardware Microsoft unveiled at E3 2016. Here's a peek at an even more powerful console coming next year.

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A slim new Xbox One S was just the beginning. As rumored, Microsoft also has a far more powerful version of its Xbox One game console coming holiday 2017, with support for virtual reality. It's called Project Scorpio.

Microsoft teases the guts of its next Xbox.

Screenshot by Jacob Krol/CNET

According to Microsoft, it will have the most powerful GPU ever put into a game console, with 6 teraflops of raw performance -- enough, Microsoft says, to render games at true 4K resolution at a smooth 60 hertz. That's in contrast with the just-announced Xbox One S, which supports 4K video playback but probably won't play games at that resolution.

"We can render fully uncompressed pixels," says an Xbox developer. The new console will play all existing Xbox One games and work with all Xbox One accessories, according to the company.

Like the original Xbox One, the upcoming Scorpio will also feature an eight-core CPU. While Microsoft didn't confirm which VR headsets will work with the new Xbox -- a partnership with Oculus was rumored ahead of the event -- the company did namedrop the upcoming VR version of Fallout 4 as a game that would specifically be coming to Scorpio. That game was announced for the HTC Vive, not the Rift.

Xbox boss Phil Spencer previously said that Microsoft doesn't plan to produce its own Xbox VR headset.

Those are all the details we have on Project Scorpio at this time, but we'll be on the lookout for more. Since so many of the rumored details about Scorpio appear to have come true, you might consider reading our huge pre-E3 Xbox rumor roundup.