By Paul Tassi,Senior Contributor
Copyright forbes
While the effects of Trump’s tariffs are severe across a number of industries at this point, few things are stranger than what’s going on with Microsoft and Xbox right now.
Microsoft was the first console manufacturer to raise prices on its Xbox hardware, rather dramatically at that, but now they’ve announced they’re back for round 2, citing economic conditions, and these prices have gotten so comically high it’s easy to wonder if they’re practically discouraging hardware sales on purpose at this point. Here’s what things increased to now, after the original hikes:
Xbox Series S (512 GB) – $380 > $400
Xbox Series S (1 TB) – $430 > $450
Xbox Series X Digital – $550 > $600
Xbox Series X Disc – $600 > $650
Xbox Series X (2 GB) – $729 > $800
We now live in a world where Microsoft believes someone is going to spend anywhere from $600 to $800 on an Xbox Series X, a console that launched almost exactly 5 years ago in 2020 at $500.
Sony is not immune to this either, and after delaying its own prices increases a while, it landed at:
PS5 Digital – $500
PS5 Disc – $550
PS5 Pro – $750
So we’re in a mirror situation where the PS4 costs $100 less than an Xbox Series X, how both systems launched in 2025, but now both are $100 more expensive.
Xbox Series X
But why is this worse on the Xbox side? Unlike PlayStation, Xbox never released a power-upgraded Series X like Sony did with the PS5 Pro. Now, we have a 2 TB Xbox Series X that actually costs $50 more than the also-2 TB PS5 Pro.
There’s also the additional factor that Xbox is pushing prices insanely high during a console generation it is already badly losing to rivals Sony and Nintendo. By some estimates, Xbox is losing to Sony at least 2:1 in sales, if not closer to 3:1, if not even more than that as the years press on as each new earnings report reveals double digit drops in hardware sales. It’s also a console that Microsoft has been pretty explicit about people not necessarily needing with games released on PC, in the cloud and now, on PlayStation.
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Microsoft is getting hit hard due to Xbox component manufacturing in China especially, but at what point are you pricing so prohibitively high you’re almost erasing your console business entirely? Is that worth an attempt to boost margins or slim losses on the hardware by actively discouraging anyone from buying some of these units at these prices? Only Microsoft knows the answer to that.
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