According to court documents in the FTC vs Microsoft trial,

 

According to court documents in the FTC vs Microsoft trial, Microsoft believes that Sony will release a PlayStation 5 Slim later this year priced at $399.99.  Microsoft also expects Sony to launch a handheld version of the PS5 later this year for less than $300. In the documents, Microsoft argues that the Nintendo Switch is also part of the console market, countering the FTC's position that it is a two-way race between Xbox and PlayStation. The filings indicate that Sony may release a smaller slimmer model of the PS5, as it did with the PS4 in 2016. Microsoft released the Xbox One S, its more compact console, in 2016, three years after the Xbox One came out. Meanwhile, Sony previously confirmed the future release of a Playstation handheld device, codenamed Project Q, though it didn't provide a launch date. The handheld will stream PS5 games using WiFi and the company's Remote Play protocol.