Neowin is reporting that they have learned from a close source to Google that the company is “hard at work” with the Nexus Two, the successor to the Nexus One.

There have not been many rumors or details regarding the “Nexus Two,” but the source claims Google is going to be releasing it within the next month. Also, with Android 3.0 (a.k.a. “Gingerbread”) in the wild, and running on what appears to be a Nexus One, or what could be the first picture of the Nexus Two, it does make sense.

The Nexus One sold around 80,000 units in its first month on the market and Sprint even dropped the Google smartphone because of poor sales, and the release of the HTC EVO 4G.

Google announced earlier this month that they are closing the Nexus One online store for good, as they had received their final stock of the smartphone.

We also reported that Google had stated in the past that there is no Nexus Two in development, but hey, any technology company will tell you that if there’s something big cooking.

According to the source, the Nexus Two will be launching sometime next month, but no pricing, date, or technical specifications were released. Google’s going to have to do something big with the Nexus Two if they want it to compete with the iPhone 4, EVO 4G, Motorola Droid X, and even the Samsung Captivate.