Microsoft went into the Xbox business with the intent to take over the living room. By the time that goal was in reach, the market shifted and now Apple and Samsung are fighting for mobile marketshare with the Windows phone lagging behind.
There may be a way to leverage the Xbox brand to gain mobile marketshare, but any efforts to do so has been clumsily executed. I saw an article where Elop and Nadella said they were firmly committed to the Xbox business, but none of why they stated their loyalty made me feel warm and fuzzy. No mention of anything like an "expanding market," "increasing marketshare" or anything that assures investors that they are in a sound market.
If Microsoft does indeed dump Xbox, it will be devastating to console gaming as a whole.