If Scorpio is going to outpower you and there is nothing you can realistically do about it, you could dump Neo, state you never formally announced it and decided against it for any number of reasons.
They could cancel, but they're already on record as to Neo's existence and planned release.
You are then free to rain on your competitors parade 1 year from now.
With a product that is at least 1 but likely >2 years away at that point.
Assuming work on the PS5 has been ongoing.
That's part of what I believe needs some kind of further justification.
Being able to rain on Scorpio's release means Sony was planning on raining on Neo's parade after 1 year on the market.
Why would they have planned to do that?
By dropping it an NOT replacing it but going with an announce next year of a true PS5 in Fall 2018 you get the benefit of outpacing MS, assuming you can build something more powerful for less 1 year later, which may not be true, and you don't incur the cost or risk of releasing the Neo.
The risk of having Neo not work out against the competition is replaced by the guarantee that the PS5 that was apparently right on its heels will negate the investment into Neo after <1 year.
If there was something Sony is supposed to squeeze out in 1 additional year past Neo's timeline, it would need to be some kind of significantly advanced Neo plan B, or hopefully there's a PCIe or other form of interconnect and AMD can plug in a discrete GPU (or another Neo chip in SMP *cue dramatic music*).
Sony would have something like a year to figure out how to get multi-GPU to work and walk back its unified memory marketing point.
I've been struggling to figure out where to put this next bit of thinking, since it partly covers Microsoft's plans, but here it goes:
Let's suppose Neo is using Polaris, and Scorpio will use Vega as everyone seems to postulating. Let's not get into the Jaguar/Zen/Zen lite speculation for now.
Imagine the upside for AMD in this case by getting the console market to inject R&D funds into not just one generation like the current ones, but two. Semi custom clients pay for R&D and NRE for hardware that has shared features that are subsidized by reuse.
Not only that, these are "premium" consoles that apparently do not intend to replace the base console chips. Likely higher prices for AMD, and likely less volume on these higher-margin chips such that the slim margins of semi custom don't necessarily drag overall corporate margins down as much as they tend to. The current chips continue to be produced and produce revenue.
And then apparently Sony rushes a PS5 out before Neo could cost-reduce too much--or it's cancelled and AMD pockets the up-front payment since it's not their fault Sony overran its own console project.
Bravo on getting those clients to pay all that money.
However, there is a speculative way to have Neo and the PS5 closer in time, but it requires that Sony was going to be more aggressive about its cadence back when 20nm was going to be used.
AMD took a charge when it indicated it would move any chips in development to FinFET. Let's say there were console shrinks in that set.
If the Xbox One Slim happens to be FinFET, it might be a porting of a 20nm shrink. I'm not clear on whether that product has changed nodes.
Scorpio could be where it is in timing and in peak performance because it is the result of Microsoft not starting from a 20nm basis and purposefully targeting a FinFET node with the technology that would come with it. Maybe Microsoft was going for a somewhat slower cadence, or was willing to go back to the drawing board. That might mean being able to use a Vega GPU, or in this scenario it might be that it is the one using Polaris on a 384-bit bus that AMD has opted for in place of a Polaris 12 in the discrete GPU realm.
Let's pretend Neo could have come out in 20nm, and that Sony didn't want to start all over again, and the year since AMD announced the 20nm skip involved a port of a 20nm Neo. In that case, Sony started out with a faster cadence, and the post-Neo architecture was genuinely further along in its development before Neo took a significant porting delay.
That scenario might mean among other things that Neo might not be Polaris, but rather the tech that could have been at 20nm. The void where that GPU might have been is outlined on the 28nm side by Tonga and Fiji.
That might mean that Neo has delta compression, but not other architectural features or adjustments to increase clock speed that Polaris shows signs of having. Given that Neo is clocking not much above where the current console GPUs clock...
Power-wise 36 CUs might have been difficult to justify, although it might have been scoped out with the assumption that 20nm wasn't going to be a large disappointment for this power band, and that some of the tweaks done for GCN3 would have helped. As an aggressive premium target, Sony might have also been willing to just burn as much power as the PS3 once did and also align Neo more with PSVR.
This scenario might also introduce some downside for AMD. Possibly some of this extra work had to be done to make up for the failure to get to 20nm, and AMD might have taken a hit in the number of chips it can put out due to reshuffling its limited engineering resources.
For full clarity: this is all just my making things up off the top of my head for the purposes of some of these scenarios.