Microsoft has announced another price increase for Xbox consoles. Starting August 1, models with 512GB storage will increase by $100, while 1TB versions will rise by $150. This means the Xbox Series S will start at $499.99, the Xbox Series X without a disc drive at $749.99, and the version with a disc drive at $799.99. The company also plans to discontinue the 2TB Xbox Series X model.
Microsoft last raised prices in October, by $20 to $70. The company had hoped to avoid further increases. "Unfortunately, console storage and memory prices have risen by more than 2.5 times, and we expect another doubling by fall 2027," Microsoft says in a blog post. The entire consumer electronics industry is facing a component crisis, but consoles are hit particularly hard. Unlike phones, computers, or speakers, consoles are typically not sold at a profit but at a price lower than manufacturing costs.
The company is also introducing new programs to make it easier to buy new Xboxes. These include buy now, pay later options and interest-free financing on Amazon. Microsoft also plans to work with retail partners on programs offering used consoles at lower prices.
The Xbox Series S was originally launched at $299 and the Series X at $499 in November 2020. In recent years, however, the company has had to repeatedly raise prices due to the component crisis, which is forcing nearly all technology companies to increase prices. Apple, for example, announced today price increases across its product lines.
The price increase comes at a difficult time for Xbox. New Xbox head Asha Sharma recently warned employees about an upcoming "reset" of the console and preparations for layoffs.