I was hoping for Andromeda but it seems Microsoft isn't committed to anything anymore. Sad sad days have come.
I hope you are wrong. The reason why I have hope is that the Surface Hub 2 is also delayed due to Andromeda. And the Surface Hub was actually selling like hot cake. We have the big one at work, and everyone at the office (which predominantly Linux developers) are seriously impressed by it. So, that says a lot right there. So I doubt it will be discontinued.
The big issue with the "Surface Phone" is, I think, cost. This is supported, at least for me, with the fact that Samsung already mentioned that they are working on a dual screen model "coming in the future", and to expect double the price of a premium phone. So $1.5k-2k. The experience, and hardware features must be compelling. Slapping the Lumia 950 camera, while still competitive today, is not enough, it has to deliver a lot of value to the consumer, and carriers must be conformable carrying it to deliver a special subsidized set of plans for the device. It's like the HoloLens, tech-wise ground breaking, but the software and acceptable price-point for the returned value needs to be delivered.
Microsoft made the mistake with the Lumia 950 series, where you had a lot of excitement in the air, but the rushed released, leads reviewers trash it due to bugs (which I don't blame them,it was indeed buggy with in your face bugs like Settings app crashing on the basic popular options), and the camera stuck on auto-focusing and more. Those were quickly fixed of course, but the harm was done.
So they need to make it right, and faster CPUs is a a welcome addition to ensure a great experience, especially if they plan to allow in some mode x86 app support. I am sure the 950 will deliver great performance, but probably still not enough, and it might need the Snapdragon 1000, or some variation of.