Key facts
- Apple and Microsoft are increasing prices on various devices due to rising chip costs.
- AI data center expansion is driving unprecedented demand for memory and storage chips.
- Xbox consoles will see price increases of $100-$150 globally starting August 1.
- Apple's Macs and iPads are subject to price hikes, with some increases reaching $300.
- Analysts predict potential iPhone price increases later this year.
Microsoft and Apple are implementing price increases across a range of consumer electronics, including Xbox consoles, Macs, and iPads, citing soaring memory and storage chip costs driven by the burgeoning AI boom. Microsoft announced that its Xbox video game consoles will see worldwide price hikes of between $100 and $150 starting August 1, attributing the increases to rising storage and memory costs fueled by AI-related demand. In the United States, the cheapest Xbox, the Series S, will increase to $500, while the Series X will cost up to $800.
Apple followed suit, announcing substantial price increases for its Macs and iPads. The company described the demand spike as an 'unprecedented challenge' for the consumer electronics industry, noting that the rapid expansion of AI data centers has created an 'extraordinary surge in demand for memory and storage.' The new entry-level MacBook Neo will cost $100 more, while the 512GB MacBook Air and the 256GB iPad Pro Wi-Fi will each increase by $200. The 1TB MacBook Pro will become $300 more expensive, and the 128GB iPad Air will cost an additional $150.
Analysts suggest that iPhone prices may also rise later this year, potentially by as much as $200 for the Pro and Pro Max models, as the era of small price increases appears to be over. The cost of storage and memory chips has more than doubled and is projected to double again by late 2027, according to Microsoft. Other consumer electronics manufacturers, including Sony and Nintendo, have also recently raised prices for their game consoles.