Citing unnamed sources from the upstream supply chain, Digitimes reported that the product will be manufactured by Pegatron Technology for release in the first quarter of 2018.
It said the device has already begun small volume of pilot production at Pegatron's plants in China.
The speaker was designed by Facebook's Building 8 department, it said.
It comes after Facebook submitted a patent to the United States Patent and Trademark Office for a “modular electromechanical device” on 20 July, together with a sketch that bore resemblance to a speaker with a screen (see above).
The patent described multiple elements that could be added to the device; a touch display, speakers, a telephone and karaoke unit. This coupled with Facebook’s investment in artificial intelligence has added fuel to the rumours that it is gearing up to launch an Amazon Echo rival.
The speaker will, however, focus on the touch panel functionality rather than voice recognition technology adopted by the Amazon Echo and Google Home, the publisher claimed.
Apple also unveiled its answer to the smart speaker revolution - Siri-based speaker HomePod - at the 2017 Worldwide Developers Conference last month. HomePod will go on sale at the end of 2017.
Alibaba, Samsung Electronics and Microsoft are also rumoured to be joining the smart speaker market.
Amazon unveiled the latest version of its smart speaker, Echo Show, in May. The Echo Show has a 7-inch touchscreen from which users can make standard queries, as well as initiate hands-free video calls, monitor their front doors or nurseries and see music lyrics as songs play.
A Facebook spokesperson told The Drum it "has no comment at this time".