Xbox Introduces Financing Options Amid Rising Console Prices Exceeding $750: Industry Faces Challenges

Every time we report on a console price hike, it feels like we’re saying, “This has to be the last time, right?” Well, not this time. Xbox has confirmed that it will raise the prices of its consoles for the third time and will also be discontinuing the 2TB model.

Starting August 1, 2026, prices will be adjusted globally. The cost of Xbox consoles will rise by $100 for the 512GB models and $150 for the 1TB models. The 2TB model will no longer be available.

Here’s the new price breakdown:

In a recent announcement, Microsoft explained that the price increase is due to a significant rise in console storage and memory costs, which have surged by 2.5 times since the last price adjustment in October. The company anticipates that these costs will double again by fall 2027.

The entire consumer electronics sector is grappling with a components crisis, but consoles are particularly affected. Unlike smartphones, computers, and other devices, consoles are often sold at a loss, priced below their manufacturing costs.

To help ease the financial burden of this price increase, Xbox is introducing a “Buy Now, Pay Later” service, allowing customers to purchase Xbox systems through its stores and pay in interest-free installments. Additionally, Amazon is offering financing options with flexible monthly payments for up to 12 months. Xbox is also collaborating with retailers to provide pre-owned and certified refurbished systems on the Microsoft Store.

This marks the third price increase for Xbox systems since 2025. The first hike occurred in May of last year, with many attributing it to newly imposed tariffs. The second increase followed in September, with Microsoft citing “changes in the macroeconomic environment.” The previous price adjustment pushed the 2TB model to an eye-watering $800, but that model has now been phased out.