Microsoft has raised Xbox console prices worldwide by up to 43%, citing rising memory and storage chip costs driven by AI demand. The increase has sparked a surge in second-hand console sales, with platforms like Gumtree reporting a spike in searches.
Price Hikes Hit UK Hard
In the UK, the baseline Xbox Series S now costs £430, up from £300, while the premium Series X with a disc drive has risen from £500 to £670. The increases reflect broader industry trends, as component costs soar.
Nav Dhillon, CEO at Gumtree, said: “The latest Xbox price increases have prompted an immediate response from cost-conscious gamers. In the first four days of August alone, we saw more than 12,000 searches for Xbox consoles on Gumtree, as buyers looked for ways to avoid the significantly higher cost of buying new.”
Second-Hand Market Booms
Dhillon added: “With some new Xbox models now costing up to £170 more, compared with a median secondhand listing price of around £100 on Gumtree, the potential savings are substantial. It reflects a broader change in how people approach big-ticket technology: buying second hand is no longer seen as a compromise, but as a smart and increasingly mainstream way to access the products they want for less.”
Microsoft is not alone in raising prices. Rival Sony increased PlayStation 5 prices by £90 in March, and Valve’s Steam Machine launched at a higher cost than expected. Both companies cited mounting hardware and storage costs.
AI Demand Drives Component Costs
The cost of RAM and graphics cards has surged due to demand from AI data centres, which require vast numbers of chips. Microsoft said in June it had “hoped another price increase would not be necessary,” but blamed rising console storage and memory costs.
Some industry observers fear prices could rise further. Jez Corden, editor at Windows Central, wrote on X: “This ain’t even the ceiling.” Amazon’s gaming boss recently suggested that higher hardware costs may push more people to stream games instead of buying consoles.
The price hikes come ahead of the winter release of Grand Theft Auto 6, expected to be one of the biggest gaming launches ever.
