Xbox prices hit record high as AI chip boom drives up costs
The tech giant’s premium Xbox Series X console with a disc drive will now cost £670, a £170 price increase
Xbox prices have soared to their highest ever level, with Microsoft blaming the growing cost of memory and storage chips amid the AI boom.
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The tech giant’s premium Xbox Series X console with a disc drive will now cost £670, a £170 rise from its previous £500 price tag.
Meanwhile, the entry-level Xbox Series S has climbed from £300 to £430, an increase of around 43%.
Microsoft said it had hoped another price increase “would not be necessary”, but said the spiralling cost of components had forced its hand.
“The entire consumer electronics industry is struggling with the current components crisis, but the effects are particularly hard on consoles,” the company said.
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It added that storage and memory technology costs had already doubled and could double again by next year.
The price increase comes as demand for RAM chips and graphics hardware surges, driven by the rapid expansion of artificial intelligence.
AI systems require vast data centres packed with high-powered chips, pushing up prices for the components also used in games consoles, computers and other everyday tech.
Sony has also raised prices, putting up the cost of its PlayStation 5 by £90 in March to £569.99.
In the US, Microsoft’s basic Xbox consoles have risen by $100 to $499, while models with more memory have increased by $150 to $749.
Critics have accused major technology firms of passing the cost of the AI race directly on to consumers - leaving gamers paying more for consoles first released years ago.
It comes after Microsoft announced it had cut 4,800 jobs in July, amounting to roughly 2.1% of its workforce.
Xbox shouldered a significant share of the layoffs, with more than 1,600 roles cut immediately.
In a memo to staff, executive vice president Amy Coleman said the tech giant needed to focus on areas that could better deliver for customers in a “fast-changing industry”.
When the original Xbox launched in 2001, it cost around £220.