If Memory Prices Hold, the Next Console Generation Starts at $1,000

The Multiple Microsoft Wrote Into Its Own Price Notice

As of August 1 the Xbox Series X went from $649.99 to $799.99. The Series S went from $399.99 to $499.99. The 2TB Galaxy Black Special Edition was discontinued. The important part is the explanation Microsoft attached to the increase: console storage and memory prices have gone up by more than 2.5x, and the company expects another doubling by the fall of 2027.

That is not an analyst estimate. It is the company that actually buys the parts, putting a number on its own supply outlook. The reason is familiar by now. Samsung and SK Hynix are routing added capacity toward high bandwidth memory for AI data centers, which pushes commodity memory for consoles and PCs further back in line. Consoles are normally sold at or below cost and earned back through games and subscriptions, so the larger memory and storage grow as a share of the bill of materials, the less room there is to absorb that loss.

Microsoft shipped a set of countermeasures the same day: interest free financing, buy now pay later, and certified refurbished units at up to $100 off. When you cannot lower the price you change the payment.

39 Million Units Is What $300 Costs

Ampere Analysis published a forecast on August 18 that converts the cost story into unit sales. If Sony and Microsoft bring conventionally designed, incrementally improved consoles to market in 2028 at $1,000, they sell 39 million fewer units over the first five years than they would at $700. The install base, meaning the number of people who actually own the machine, comes out 38% smaller. By 2031 the combined console games and services market across PlayStation and Xbox is $3.4 billion smaller, or 12%.

Senior research director Piers Harding-Rolls stated the condition rather than the doom: taking incrementally improved hardware to market at substantially higher prices risks shrinking the addressable audience. He listed three ways out. Delay the launch until component costs come down, subsidize hardware more aggressively, or build something different enough to justify the number.

For a studio shipping on console, one calculation changes. Holding the same sales target means winning a higher share of a smaller base. A project that breaks even at a million copies is chasing that same million inside an install base 38% smaller, which is a materially harder attach rate than the one in the current plan.

The Other Forecast Assumes Components Loosen by 2028

S&P Global Market Intelligence Kagan draws a different picture. Analyst Neil Barbour put 2026 console shipments at 33.9 million units, down 19.5% year over year, with Switch 2 at 17.1 million, PS5 at 13.2 million, and Xbox Series X and S at 2.5 million. Even so, Kagan expects next generation pricing in the $600 to $800 range, with PS6 starting at 4 million units in 2028 and reaching 17.2 million by 2030.

The gap between the two forecasts comes down to a single premise. Kagan’s $600 to $800 assumes the component crunch eases enough by 2028. Microsoft has already published a sentence that runs directly against that assumption. Nobody knows yet which one holds, which is exactly why building a plan on one of them is the risky move.

If your 2028 revenue plan includes console, model it twice, at $700 and at $1,000. Where the two versions disagree on marketing spend, launch timing, or platform order is where this forecast actually matters to you. And note what a company does when it cannot cut the price: Microsoft attached financing and refurb discounts on the same day it raised it. If you sell anything alongside a console, the payment flow is the part worth rechecking first.