Microsoft has announced another global price increase for its Xbox Series S and Xbox Series X gaming consoles, marking the third price hike since May 2025. The company attributed the decision to the continued rise in memory chip and storage component costs. Microsoft also confirmed that it will discontinue the 2TB version of the Xbox console.

Price Increases of Up to $150 Starting in August

Microsoft said the new prices will take effect on August 1, with the 512GB models increasing by $100, while 1TB versions will see price hikes of up to $150.

At the same time, the company announced it will stop manufacturing the 2TB storage variant, removing the highest-capacity model from its lineup.

According to Microsoft, the decision follows a comprehensive review of its supply chain as memory chips and storage components continue to become more expensive.

Memory Shortages Continue to Pressure the Gaming Industry

The company noted that prices for memory and storage components have risen by approximately 2.5 times compared with previous years and are expected to remain elevated through 2027, potentially leading to further hardware price increases.

Microsoft explained that gaming consoles are particularly vulnerable because they are typically sold with very low profit margins—or even below manufacturing cost—unlike smartphones, PCs, and many other consumer electronics.

New Financing Options and Refurbished Consoles

Alongside the price increases, Microsoft unveiled new purchasing programs aimed at easing the financial burden on consumers.

These include Buy Now, Pay Later options and interest-free financing plans for up to 12 months in selected markets.

The company also plans to expand sales of certified refurbished and pre-owned Xbox consoles, providing more affordable alternatives for gamers.

Industry-Wide Impact

Microsoft is not the only company affected by rising component costs.

Sony has previously increased prices for selected PlayStation 5 and PlayStation 5 Pro models in several markets, citing similar supply chain pressures and higher memory costs.

Industry analysts believe that soaring demand for memory chips used in artificial intelligence applications has driven component prices significantly higher, increasing manufacturing costs for gaming consoles, smartphones, and other consumer technology products.