Microsoft raises Xbox prices worldwide starting August 1

Microsoft has announced that Xbox console prices will increase worldwide starting August 1. According to the company, these price increases are driven by rising memory and console storage costs. Alongside the worldwide price hikes, Microsoft is discontinuing its 2TB Xbox model. The price adjustments will target different storage configurations, specifically adding:

• $100 more for 512GB models
• $150 more for 1TB models

The decision marks the latest pricing adjustment for the gaming hardware, following a previous Xbox price increase in the U.S. last October.

The pricing pressure reflects a trend across the consumer electronics sector. Microsoft reported that its component costs are now 2.5x higher than previous levels. Looking ahead, the company warned that console prices could double by the fall of 2027. This development follows price increases from Apple, which recently announced price increases across its hardware lineup. Apple asserted that its price hikes are due to soaring memory and storage costs, which have been fueled by demand for AI infrastructure and data centers.

To mitigate the impact of these increases on consumers, Microsoft is highlighting financing options. For instance, the company is promoting options that include 12 months of 0% APR financing—which represents financing with no annual percentage rate interest—for Amazon shoppers. Microsoft also confirmed it is “working on new programs to provide previously played consoles at lower prices.” With this move, Microsoft joins its competitor Sony, which also raised prices, while Nintendo has similarly raised prices for the Switch 2.

Why it matters

The back-to-back announcements from Microsoft and Apple underscore how much the AI boom is impacting the price of everyday electronics as demand for advanced memory and storage chips surges.