Following Sony’s March price hike for the PlayStation 5, Microsoft has now announced its own significant adjustment. The company revealed that all Xbox models will see a price increase, and it will also phase out one storage variant. The changes will take effect after a short transition period.
Starting on August 1, 2026, every Xbox Series X|S with 512 GB of storage will carry an additional $100, while the 1 TB models will see a $150 bump. Simultaneously, Microsoft is discontinuing all 2 TB variants.
Microsoft cited the global components crisis as the main catalyst behind the price changes, noting that console manufacturers often sell units at a loss—unlike other consumer electronics that enjoy healthy profit margins.
Microsoft attributed the recent price increase to a sharp rise in storage and memory costs, which have climbed more than 2.5‑fold since the last console price adjustment. The company projects that these components could double in price by the autumn of 2027.
❓ Frequently Asked Questions (FAQ)
Why did Microsoft increase Xbox prices and discontinue 2TB models?
Microsoft cited the global semiconductor shortage and a sharp rise in storage and memory costs—more than 2.5‑fold since the last price adjustment—as the main reasons for the price hike. The company also noted that console manufacturers often sell units at a loss, unlike other consumer electronics, and that the cost of key components could double by autumn 2027. To offset these rising costs, Microsoft raised prices for all Xbox Series X|S models and decided to phase out the 2TB variants.
When will the price changes take effect and which models are affected?
The price adjustments will begin on August 1, 2026. All Xbox Series X|S consoles with 512 GB of storage will see an additional $100, while the 1 TB models will have a $150 bump. The 2 TB variants will be discontinued and will no longer be available after the transition period.
How might this price hike impact competition and consumer choice in the gaming market?
The increase could reshape competitive dynamics, prompting rivals like Sony and Nintendo to reassess their pricing and supply strategies. Consumers may face higher upfront costs but could also see a shift in the availability of storage options, potentially leading to more emphasis on cloud storage or mid‑tier models. Overall, the move reflects broader industry strain from component shortages and may influence future console pricing trends.
News Source: Neowin
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