Microsoft Raises Xbox Prices Amid Economic Challenges

REDMOND, Wash. — Microsoft announced on September 19 that it will increase the prices of its Xbox gaming consoles in the U.S. for the second time this year. These changes, effective October 3, come as the company’s video game division faces challenges from tariffs, competition, and consumer spending uncertainties.

The one-terabyte Xbox Series S will retail for about $450, while the high-end Series X will be priced near $650. The special edition two-terabyte Galaxy Black Series X will sell for almost $800. This follows a price increase in May which saw similar hikes in various markets like Europe and Australia, initially driven by U.S. tariffs on imports from countries such as China.

Joost van Dreunen, a professor at NYU Stern School of Business, noted, “This price increase is less about opportunism and more about tariff raises and rising supply chain costs.” With these adjustments, the Xbox Series X has experienced a total price jump of $150 within just six months, which may force gamers to reconsider their budgets, particularly amid higher inflation.

The competing PlayStation line from Sony also saw a price hike last month, with the PlayStation 5 increasing approximately $50. The most expensive PS5 Pro now sells for $749.99.

Microsoft clarified that prices for controllers, headsets, and consoles in other international markets will remain unchanged. The company had anticipated consoles would be a key growth driver for the video game industry in 2025, especially with the launch of highly anticipated titles like Grand Theft Auto VI and Nintendo’s Switch 2. However, ongoing delays in game releases and increasing prices have created a challenging outlook for the industry.