Microsoft’s latest Xbox console price increase in the UK and Europe has now come into effect, making several models significantly more expensive for buyers. Effective August 1, 2026, Xbox consoles with 512GB of storage are now priced $100 higher, while 1TB models have become $150 more expensive. With the price hike, the company has also discontinued its 2TB model. The latest Xbox price hike comes less than a year after the company raised console prices in the US by between $20 and $70 last October. Microsoft blames rising storage and memory costs for the latest increase, saying component prices have climbed sharply and could rise further.
Microsoft blames rising memory and storage prices
Explaining the decision, Microsoft said it had spent several months working with suppliers in an effort to avoid another Xbox price increase. “We hoped another price increase would not be necessary, and we have spent the last several months working with suppliers on options,” the company said.According to Microsoft, storage and memory prices used in Xbox consoles have increased by more than 2.5 times. The company expects those costs to double again by the fall of 2027.Microsoft said the wider consumer electronics industry is dealing with a components crisis, but argued that gaming consoles are particularly affected because they are generally sold for less than what they cost to manufacture.The company has not changed prices by the same dollar amount across its entire Xbox lineup. The increase depends on storage capacity, with 512GB consoles receiving a $100 hike and 1TB versions becoming $150 more expensive.Microsoft is also “sunsetting” the 2TB Xbox model, meaning the company is phasing out that version.
Microsoft announces financing and cheaper Xbox options
Alongside the higher prices, Microsoft announced several measures aimed at making Xbox consoles more affordable. Eligible Xbox hardware purchases through Microsoft Stores can now use Buy Now, Pay Later options, allowing customers to divide the cost into short-term, interest-free instalments.Microsoft is also working with partners to provide up to 12 months of financing at 0% APR on eligible Xbox hardware.The company is developing programmes with retail partners for “previously played consoles.” Under the plan, existing Xbox owners will be able to trade in eligible consoles for cash or store credit, with those devices later being offered to other customers at lower prices.Microsoft also said Xbox Certified Refurbished Consoles are available through Microsoft Stores for discounts of up to $100 from their suggested retail price.
