Xbox Series X/S Prices Surge as Microsoft's Hardware Costs Continue to Climb

It’s a rough time to be in the market for a new gaming system, as the steep increases in memory and storage components driven by the surge in AI-focused data centers have been repeatedly passed on to consumers looking for their next gaming rig. On Monday, we discussed how the official prices for Valve’s answer to home consoles, the Steam Machine, were released at a price point higher than gamers would have hoped, even higher than Valve had reportedly planned to price the Machine initially. Yesterday, we shared speculation from industry insiders that the major console makers would follow suit, with agreement that the next generation of PlayStation and Xbox consoles would be knocking on the door of a four-figure price tag, if not shooting past the $1,000 mark entirely. Now, via a post on Xbox Wire, we learn that the current generation continues to be hit by the same price hikes, as Microsoft will be issuing another round of price increases for Xbox Series X|S. This is the second price hike in less than a year, with the company announcing increases ranging from $20 to $70 across its offerings. This next increase will be more significant. The consoles with the smallest hard drives, the 512 GB models, will retail for $100 more, while the larger 1 TB models will cost an additional $150. It appears the company has determined that shipping consoles with larger storage than that is not a feasible business proposition in the current market, and so Microsoft will also be sunsetting the 2 TB models. The announcement also included a range of options the company is exploring to make getting a console less intimidating as a prospect in light of the increases. This will include a buy-now, pay-later system; partnerships to offer 1-month 0% APR financing plans on consoles; a pre-owned console buyback and sale program; and certified refurbished consoles at discounted rates of up to $100. The new pricing plan goes into effect on August 1.