Microsoft has raised prices for Xbox Series X|S consoles by $100 to $150, effective August 1. The base 512GB model rises by $100, while larger models see increases up to $150. This marks the third price hike since May 2025, driven by surging memory and storage component costs.
Costs for storage components have skyrocketed by more than 2.5 times since 2024, with projections suggesting a further doubling by fall 2027. High-bandwidth memory (HBM) is in high demand, as companies like Samsung and Micron divert production towards AI applications, which command higher prices.
Similarly, Apple announced price increases of $100 to $300 for various MacBook and iPad models, attributing these hikes to the same AI-related surge in memory demand.
Despite these price increases, Microsoft is still losing hundreds of dollars on each console due to high component costs, leading to the discontinuation of the 2TB Xbox model. The ongoing global DRAM and NAND market instability prompted by AI demand continues to strain consumer electronics manufacturers.
For investors, the focus should be on chip manufacturers like Samsung and Micron, who prioritize AI over consumer electronics, affecting the supply chain and pricing landscape significantly.