Microsoft hikes Xbox prices worldwide as gaming industry faces tariff uncertainty

NEW YORK (AP) — Amid a backdrop of ongoing tariff uncertainty, more and more gamers are facing price hikes.

Microsoft raised recommended retailer pricing for its Xbox consoles and controllers around the world this week. Its Xbox Series S, for example, now starts at $379.99 in the U.S. — up $80 from the $299.99 price tag that debuted in 2020. And its more powerful Xbox Series X will be $599.99 going forward, a $100 jump from its previous $499.99 listing.

“We understand that these changes are challenging," Microsoft wrote in a Thursday Xbox support update and subsequent statement sent to The Associated Press. The tech giant didn't point to tariffs specifically, but cited wider “market conditions and the rising cost of development.”

Beyond the U.S., Microsoft also laid out Xbox price adjustments for Europe, the U.K. and Australia. The company said all other countries would also receive updates locally.

Some Xbox accessories, including wireless controllers, are impacted too — as well as headsets in the U.S. and Canada. And further down the road, Microsoft said it also expects to make some of its new, first-party games more expensive this holiday season — with a price tag of $79.99.

The price hikes arrive during a turbulent and uncertain time for the gaming industry, largely due to new tariffs implemented by U.S. President Donald Trump — and responding retaliation from targeted countries, notably China. Economists have warned that the steeper levies will result in higher prices on a range of consumer goods relying on a global supply chain today, including electronics.

And Xbox players aren’t the first gamers to feel impacts amid these ongoing trade wars. Last month, Sony, for example, raised its recommended retail pricing for PlayStation 5 consoles in select markets — including countries in Europe, the Middle East and Africa, as well as Australia and New Zealand. At the time, the company cited “a challenging economic environment, including high inflation and fluctuating exchange rates.”

Preorders for Nintendo’s highly-anticipated Switch 2 were also delayed in April as retailers assessed the potential impact of tariffs. Nintendo later confirmed that some Switch 2 accessories would see price adjustments — but maintained that its previously-announced baseline price for the console, $449.99, would remain the same.

The starting $449.99 price for the Switch 2 is significantly higher than the original Switch’s $299 price tag. And while new bells and whistles may account for a sizable portion of that hike, experts have previously noted that new import taxes are also a contributor.

While companies across industries have already shared weaker or cloudy outlooks amid tariff uncertainty, larger impacts on their bottom lines may not be seen until farther down the road. The Xbox price hikes were announced just one day after Microsoft posted a strong earnings report.

For the January-March quarter, the Redmond, Washington-based company raked in $70.07 billion in revenue, with a net income of $25.8 billion. Microsoft also saw a 6% increase for revenue in its personal computing unit, which includes its laptop business and Xbox services. But that was before many of Trump’s latest tariffs took effect.