Microsoft's announced Xbox Series S and X price increases, first revealed on June 25, 2026, took effect in Europe and the UK, with consumers only learning local pricing today as it went live. In Europe, prices rose by up to €200, with the Xbox Series S 512GB going from €349.99 to €499.99, the Series S 1TB from €399.99 to €599.99, and both Series X models increasing by €200 to €749.99 and €799.99. In the UK, increases reached up to £170, with the Series S 512GB rising to £429.99 and the Series X disc model reaching £669.99. According to Wccftech, these regional hikes are steeper in local currency terms than the $100–$150 increases previously announced for the US market, though Microsoft has said the changes are tied to an ongoing memory and storage component crisis also affecting rival Sony, which has raised PlayStation 5 and PS5 Pro prices as well.
Wccftech noted that Sony's consoles continue to sell strongly, with PS5 shipments surpassing 95 million units, compared to estimates of around 35 million for Xbox, contributing to what is described as one of the largest sales gaps between the two platforms in their history. The report suggested that holding off on price increases ahead of the anticipated release of Grand Theft Auto VI could have helped Xbox attract new hardware buyers, but Microsoft has instead moved forward with the hikes, reflecting a shift away from heavily subsidizing the Xbox hardware business.
This pricing move comes amid broader financial pressure on the Xbox division. According to TechPowerUp, Microsoft's Q4 2026 results showed Xbox content and services revenue down 10% year-over-year, while hardware revenue fell 13%. CEO Satya Nadella said Microsoft is adjusting its content, publishing, and hardware strategy to reset the business for long-term growth, with an explicit goal of returning Xbox to growth in fiscal year 2027. TechPowerUp linked this pressure to earlier layoffs affecting 3,200 employees, part of what Xbox CEO Asha Sharma has called an internal 'Xbox reset.'
A leaked internal memo from Sharma, reported by Wccftech via The Verge, outlined four strategic pillars for Xbox: strengthening the core platform led by console, growing games into global franchises, making Minecraft a leading creator platform, and extending popular game worlds. Sharma set a three-stage roadmap: returning to growth in fiscal 2027, building revenue-generating businesses around these pillars in fiscal 2028–2029, and ultimately reaching half a billion daily active players by 2030. The memo disclosed that Xbox currently has more than 100 million daily active users, over 500 million monthly active users, and nearly 1 billion yearly active users, meaning the 2030 target would require converting current monthly-level engagement into daily engagement. Sharma also said three Xbox-linked franchises each generate more than a billion dollars annually, which Wccftech suggested likely includes Call of Duty and Candy Crush, with World of Warcraft as a possible third.
Separately, Wccftech reported comments from Windows Central's Jez Corden suggesting Microsoft is evaluating how Xbox operates on PC in ways that could open a window to potentially withdraw from Steam, though Corden stressed this is far from certain given the revenue Microsoft would leave on the table by doing so. This discussion was tied to Xbox's next-generation hardware project, known as Project Helix, which is expected to cost more to produce than a rival PlayStation 6 due to its APU, making the platform's cut from game sales through storefronts like Steam more significant to its business model. TechPowerUp also noted that, given the push for higher margins, it would not be surprising if Microsoft reduced hardware subsidies for Helix as well.