The most expensive Xbox upgrade this summer may be the same console.
Microsoft will raise Xbox console prices worldwide on August 1, with 512GB models increasing by $100 and 1TB models by $150. In the US, the Xbox Series X will rise to $800.
In an Xbox Wire post, Microsoft said storage and memory prices have increased by more than 2.5 times and could double again by fall 2027. The company is also sunsetting its 2TB Xbox Series X model.
New Xbox prices start August 1
The new US prices are:
- Xbox Series S 512GB: $500
- Xbox Series S 1TB: $600
- Xbox Series X Digital: $750
- Xbox Series X: $800
The increase follows earlier Xbox price hikes in May 2025 and October 2025, according to Engadget. That makes this the third Xbox console price increase since the start of 2025.
Microsoft said it spent the past several months working with suppliers before deciding another price increase was necessary. The company said consoles are especially affected because they are typically sold below cost, unlike many phones, computers, speakers, and other consumer devices.
To soften the price jump, Microsoft is pointing customers toward buy now, pay later options through Microsoft Stores, 0% APR financing through Amazon, previously played consoles through retail partners, and certified refurbished Xbox consoles.
The pricing update comes during a broader reset for Microsoft’s gaming business. TechRepublic previously reported that Microsoft was planning an Xbox Mode for Windows 11 PCs and that an Xbox leadership shake-up signaled more changes across the division.
Memory costs are the bigger signal
For most IT buyers, the Xbox increase is not a direct procurement issue unless their organization buys gaming hardware. The more useful takeaway is that memory and storage costs are becoming harder for hardware makers to absorb.
That pressure is tied partly to AI infrastructure demand. TechCrunch noted that AI data centers are increasing demand for the same kinds of memory and storage components used across consumer hardware. Engadget made a similar connection, pointing to Microsoft’s own AI infrastructure spending as part of the wider supply-demand problem.
That does not mean Xbox pricing predicts every PC or tablet price increase. It does mean hardware buyers should keep a closer eye on memory and storage trends when planning refresh cycles. If those component costs continue to rise into 2027, endpoint budgets may need more room than older pricing baselines suggest.
The Xbox price hike also comes as Microsoft continues to invest heavily in AI infrastructure, including a deal with IREN for cloud capacity. Microsoft has not tied that deal to Xbox pricing, but both stories point to the same pressure point: AI infrastructure is competing for the components that many devices still need.
Also read: Microsoft’s July Windows 11 update focuses on practical PC fixes.