Microsoft raises Xbox console prices again, discontinues 2TB model

Microsoft is raising Xbox console prices worldwide on August 1 and cutting the 2TB Series X from the lineup, a one-two punch that makes the entry point higher and the storage-rich option harder to find. In the U.S., the Xbox Series S 512GB will rise to $499.99, the Series S 1TB to $599.99, the digital-only Xbox Series X to $749.99, and the standard Xbox Series X to $799.99.

That means the models getting more expensive are the 512GB and 1TB consoles, while the 2TB Series X is being sunset entirely. For anyone waiting on the sidelines, this is the moment to buy before the change lands: the cheapest Xbox hardware is about to cost $100 more, and the premium end is either vanishing or moving even farther out of reach.

Microsoft is blaming the move on a brutal component market. In its Xbox Wire post, the company said console storage and memory prices have climbed by more than 2.5x and could double again by fall 2027. It also said it had spent months working with suppliers and hoped another increase would not be necessary. The company’s defense is familiar for console economics: Xbox hardware is usually sold below cost, so when memory and storage spike, the pressure hits the box itself instead of being absorbed the way software-heavy businesses can.

The pitch to soften the blow leans on financing and secondhand paths. Microsoft is pointing buyers to buy-now-pay-later options through Microsoft Stores, 0% APR financing through Amazon for up to 12 months, trade-in programs, previously played consoles, and certified refurbished systems. That is a clear signal about where Microsoft thinks the value case still lives, because the headline sticker price is no longer doing any favors.

The timing makes the move sting more. Microsoft already raised U.S. Xbox prices last October by $20 to $70, and multiple reports have described this as the third Xbox price hike since May 2025. CNBC also tied the memory crunch to AI chipmakers soaking up component supply, said Microsoft shares fell almost 4% on the announcement day, and noted the company made the announcement the same day Apple lifted MacBook and iPad prices.

For players deciding between an Xbox, a PlayStation 5, or a gaming PC, the late-generation math is getting less forgiving for Microsoft’s box. Xbox is still leaning on the cheapest-entry pitch around Series S and big upcoming games like Grand Theft Auto VI, Halo: Campaign Evolved, Gears of War: E-Day, Call of Duty: Modern Warfare 4, Assassin’s Creed Black Flag Resynced, and Madden NFL 27, but the hardware itself is no longer behaving like a bargain.