Microsoft has announced another global price increase for its Xbox gaming consoles. The devices will be up to AED 367.25 more expensive starting on August 1, 2026. The tech giant attributed the decision to rising storage and memory costs resulting from an extended global component shortage.
The move comes just hours after Apple raised prices for its devices, highlighting mounting cost pressures across the consumer electronics industry.
Microsoft noted that, “The entire consumer electronics industry is struggling with the current components crisis, but the effects are particularly hard on consoles. Consoles are usually not sold at a profit, but instead for less than they cost to make.”
With the new pricing structure, Xbox consoles with 512 GB of storage will cost an additional AED 367.25, while those with 1 TB will cost AED 550.88 more. Moreover, the company will stop producing its 2TB version of the console.
Unlike smartphones and laptops, gaming consoles are often sold at slim margins or below manufacturing cost. As a result, sustained increases in component prices have made it increasingly difficult to absorb higher production costs.
Microsoft said the gaming industry continues to face severe supply chain challenges as storage and memory prices have increased by more than 2.5 times. The company warned that component costs could rise even further by 2027.
The pricing changes on Xbox follow similar trends seen in the technology industry. In particular, Apple recently announced price increases for various MacBooks and iPads, citing rising costs of memory and storage due to high demand for AI infrastructure. Similarly, Sony has increased the prices of PlayStation 5. This marks Microsoft's third Xbox price increase within a year.
The latest Xbox price hike reflects the wider impact of the AI-driven surge in demand for memory and storage chips. With semiconductor prices remaining high, further price increases across the consumer electronics industry are expected.
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