Atari deal for PHX2? What a load of nonsense.
For Atari you don't need PHX2 hardware and barely anyone would buy It.
Chinese handhelds with PHX2 would sell a truckload more than Atari.
PHX2 would also do as a fine successor to Aerith in Steam Deck.
GPU performance wouldn't improve much, but Steam Deck has a serious problem with battery life, so a weaker but more efficient PHX2 would be a better option than the more powerful PHX.
Valve can pay for a SoC under the Strategic Silicon Solutions group at AMD. I doubt they would bother with a mainline cost-optimized part.
SCBU->S3 is covering Sony, Microsoft, and Valve.
Revenue for Valve's gamefront is estimated at ~3 billion usd for the first half, January 2022-June 2022.
Revenue for Atari's gamefront is ~5.6 million euros the prior year, July 2021-July 2022.
OneX, Ayaneo, Ayn, and ANBERNIC are well within the backer range of the Atari VCS. So, truckloads more is unlikely and only Atari has the capability of software to offset hardware cost.
FC(No NB) -> WR(w/ NB) CEO (and founder participation) change would definitely want to get off the sabotaged early-gen console/minipc. To a modern next-gen console/minipc, specifically FP5 cost-optimized to FP8 cost-optimized. PHX2 would make the most sense for Atari to do that without destroying the bank on a S3 product.
Even with FC, AMD still published a tiny presser for it:
"As well, Atari© is using the high-performance Vega 3 graphics and ‘Zen’ CPU architecture in the AMD Ryzen Embedded R1000 SoC to power the upcoming Atari VCS™ game system." Unlike your mentioned chinese handhelds. Also, Atari VCS is also Manufactured in China.