Xbox prices soar up to 43% hitting €800 in Europe: Here's why

Microsoft has dramatically raised Xbox console prices across Europe and the UK, with the cost of some models rising by nearly half their original cost.

The major reason behind this surge is a global memory and storage component crisis fueled overwhelmingly by surging demand from the artificial intelligence industry.

Major AI companies, including Microsoft itself, are increasingly purchasing vast quantities of high-performance GDDR6 memory chips and graphics components to power AI training and data centers. This drives memory prices up by more than 2.5x, with expectations of another doubling by fall 2027.

The problem of the shortage in the supply chain has affected the producers of gaming consoles especially hard since the latter, contrary to such gadgets as smartphones and personal computers that are sold with profit, are usually sold at a loss, meaning that Microsoft cannot afford to take the increased expenses on components. As a result, Microsoft had to transfer these costs to consumers, thus becoming the last one to be affected by what is called the “AI tax,” an economic phenomenon during which people who play games are paying for the AI revolution that beats them for the components of their consoles.

The increased prices are applicable from August 1, with Xbox Series S 512GB jumping from €349 to €499, marking a staggering 43% hike. The flagship Xbox Series X with disc drive is now priced at €799.99 (previously available at €599.99), while in the UK the prices go up from £499.99 to £669.99.

This massive increase in prices has drawn sharp criticism from gamers. With GTA VI approaching and component costs continuing to rise, gamers may face even steeper prices in the months ahead.