Effective August 1, the price of Xbox consoles will jump by $100 for 512 GB models and $150 for 1 TB models. Additionally, Microsoft will be discontinuing its 2 TB model entirely, News.Az reports, citing Reuters.
The tech giant explained that the hardware supply chain crisis has dealt a particularly brutal blow to the gaming sector. “Unfortunately, console storage and memory prices have increased by more than 2.5 times, and we expect another doubling by the fall of 2027,” Xbox stated, noting that they can no longer absorb the massive manufacturing expenses.
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This marks the third time Xbox has bumped up console prices in recent memory, following two separate hikes last year driven by tariff pressures and shifting consumer spending.
Xbox is far from alone in feeling the squeeze. The massive surge in demand for memory chips—heavily driven by the artificial intelligence industry’s aggressive datacenter expansion—is triggering dramatic price hikes across the entire consumer electronics market. Rival Sony already raised PlayStation 5 prices back in April, and Apple just announced price hikes for its iPads and MacBooks on Thursday for the exact same reason.
The price hikes arrive during a turbulent period for Microsoft’s gaming arm. Earlier this month, reports surfaced that Xbox is planning major corporate layoffs next month alongside aggressive cuts to its marketing and operational budgets to counter the rising industry costs.
