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Microsoft said it's increasing the price of Xbox game consoles after Apple announced price hikes for MacBooks and iPads.
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Key Points- Microsoft said it's increasing the price of Xbox game consoles after Apple announced price hikes for MacBooks and iPads.
- Starting Aug. 1, Xbox Series S consoles containing 512GB of storage will go up by $100 to about $500, and models with 1TB will increase by $150.
- The consumer electronics industry is getting hit with surging memory prices due to historic demand for the components from AI chipmakers.
Hours after Apple announced price increases for MacBooks and iPads, Microsoft said consumers can also expect to pay more for Xbox game consoles, reflecting rising component costs.
Starting Aug. 1, Xbox Series S consoles containing 512GB of storage will go up by $100 to about $500, Microsoft said Thursday, while models with 1TB will increase by $150 more. The entry-level Xbox Series X will now start at about $750.
"Last October, we increased XBOX console price by $20-$70 in the U.S.," the company said in a blog post. "We hoped another price increase would not be necessary, and we have spent the last several months working with suppliers on options."
Microsoft said "console storage and memory prices have increased by more than 2.5x and we expect another doubling by the fall of 2027."
Memory manufacturers such as Micron and SK Hynix have a limited capacity, and they are prioritizing high-bandwidth memory for artificial intelligence infrastructure, such as Nvidia's graphics processing units. Manufacturers are raising prices to reflect higher demand, resulting in wider profit margins.
That puts a strain on consumers looking to buy devices such as smartphones, tablets and computers. Apple's announcement on Thursday came after CEO Tim Cook told The Wall Street Journal that price increases had become inevitable.
"The entire consumer electronics industry is struggling with the current components crisis, but the effects are particularly hard on consoles," the Xbox unit said in the post. "Unlike phones, computers, speakers, and other consumer devices, consoles are typically not sold at a profit, but instead for less than they cost to make."
Microsoft said the 2TB Xbox Series X, introduced in 2024, will no longer be available.
Microsoft shares fell 3.5% on Thursday. Apple's stock dropped 6.1%.
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