Microsoft raises Xbox prices worldwide as memory shortage bites
Xbox prices jumped worldwide as Microsoft said memory costs had surged more than 2.5 times and another doubling could hit by fall 2027.
Microsoft raised Xbox console prices worldwide and will discontinue its 2-terabyte model as AI-driven demand for memory and storage chips continues to push up the cost of consumer electronics. The change takes effect August 1, with 512-gigabyte models rising by $100 and 1-terabyte models by $150.
The increase is Microsoft's third Xbox price hike since May 2025. In the United States, Xbox prices had already risen in October by between $20 and $70, and Microsoft spent months working with suppliers before concluding it could not absorb the latest jump in component costs. Console storage and memory prices have increased by more than 2.5 times, and Microsoft expects another doubling by the fall of 2027.
The pricing pressure is rooted in the same supply squeeze hitting the wider tech sector. AI data-center buildouts are competing for the memory and storage chips used in consoles, PCs and smartphones, forcing manufacturers to pass along more of the cost. The console business is especially exposed because game systems are often sold at a loss, a model that has become harder to sustain as component costs climb.
To blunt the impact, Microsoft is expanding buy-now-pay-later options and reselling programs for used consoles. That includes financing through Amazon at 0% APR for a year.
The same pressure reached Apple on the same day, when it raised iPad and MacBook prices while leaving the iPhone unchanged.
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