Breaking: Xbox and Microsoft reveal global price increases for consoles, accessories — and even games

You can certainly read into this (and also just reading the room) that Xbox execs are getting a huge amount of pressure from Microsoft execs to make the gaming division more profitable for them. If this doesn't dramatically change the picture for Xbox this year as far as financial return to Microsoft, I have to imagine we'll be seeing some major pivoting away from hardware as well as some heads rolling.
 
Tarrifs from my understanding only apply to the assembled BoM cost (i.e MS's break even cost), NOT the retail price. So if it costs MS $300 to build a Series X, the tarriffs are levied on $300, not $500.
Well obviously. You can't price a tariff off a price of something that hasn't sold. You would price a tariff off the cost paid to carry the product, or build the product. The money going to the government from the tariff charge would have already been paid by the time the product was sold through retail. You can't assess tariffs from a product sold at a Walmart based on the price it sold at off the receipt. Then you would be basing the tariff off the retail margin, which is preposterous and would be hopelessly impractical and impossible to manage. This shouldn't be a difficult thing for anyone to grasp.
 
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Unlike Microsoft, I think they planned to stockpile in the US, but we'll see. They could see this as an easy way to increase revenue and profit margin and see if people will buy for GTA6 regardless.
I have some hope in what you're saying, but stockpiles eventually run out.

Tarrifs from my understanding only apply to the assembled BoM cost (i.e MS's break even cost), NOT the retail price. So if it costs MS $300 to build a Series X, the tarriffs are levied on $300, not $500.
Microsoft already loses money on Series X. Sony likely fluctuates between small profit or loss too.

That BOM is far higher than you think it is.
 
You can certainly read into this (and also just reading the room) that Xbox execs are getting a huge amount of pressure from Microsoft execs to make the gaming division more profitable for them. If this doesn't dramatically change the picture for Xbox this year as far as financial return to Microsoft, I have to imagine we'll be seeing some major pivoting away from hardware as well as some heads rolling.

Depending on how long it takes Sony to follow suit... it won't matter...

It'll be VERY interesting to see circana numbers if Sony doesn't follow suit and this goes into effect for May.

We'll see tangibly how much people are willing to pay to stay in their ecosystem.
 
Share holders: "Hey guys, we're losing bad overall. Sales for hardware are way down. How will we attract more customers?"

A bald man: "Raise our prices."
 
Sad to see some users liking the OP. Has it really got to the stage that people will support anything their favourite company announces?
 
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Thank you Agent Donaldovich Trumponov
 
Depending on how long it takes Sony to follow suit... it won't matter...

It'll be VERY interesting to see circana numbers if Sony doesn't follow suit and this goes into effect for May.

We'll see tangibly how much people are willing to pay to stay in their ecosystem.
Sony and Xbox in particular in North America have been eating the increases in build costs, etc ever since the pandemic, increased expense of parts, labor, freight, etc for years now. Spencer has been saying for 3-4 years now they can't hold pricing at pre-pandemic levels indefinitely. The looming tariffs are certainly what broke the camel's back. When Sony did their PS5 price increase related to pandemic cost increases a few years ago, they notably did not raise prices in North America. With not only Xbox but now even Nintendo doing so, (again…tariffs), knowing how much Sony corporate loves to wring profit out of PS, they absolutely will follow suit. 💯 %.
 
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$80 Microsoft games? Oof....they ain't got a lot of games needing that $80 hit.
Xbox games in and of themselves don't really sell anymore anyway, this is just a bummer for collectors more than anything. Game Pass has trained what I assume is a large portion of Xbox players not to purchase to own individual software. But certainly all the games Xbox sells on PC, PS and Nintendo will reap a lot more money for them.
 
If Sony doesn't follow suit before GTA6 releases, it will be the end of the xbox brand as an option in retail...

100% correct! The question is, does Sony have the stomach and will to make the KILL?!

Ain't no way they are footing it. A 140% increase of 299 would be an extra 418 dollars. But they only raised the price to 379. They aren't eating an extra loss of about 340 dollars every series s. If they managed to sell 1 million consoles that would be an over 300 million loss. And that isn't even factoring in the margins for retailers etc. It would be more profitable to just not sell the consoles at that point.

This is the point man. Wake up!
 
Effective immediately.

Microsoft says "May 2025", which basically gives them until the end of the month to communicate and coordinate this with their retail partners.
shit, i might just collecting some bottle caps RN
If WWIII was on agenda....
 
whats happening?

1- moore law is dead and every node will be more expensive
2- they stopped to subsidizing consoles

what we should do/have done?

1- stop buying those hardwares, either consoles of computers
2- we should have been stayed (or want back) on the ps4/one generation
 
100 bucks more for a console? Fuck off.

And games 80 bucks, so 90 euros in Europe? Unbelievable. Thank fuck we still have game sharing.
 
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Ain't no way they are footing it. A 140% increase of 299 would be an extra 418 dollars. But they only raised the price to 379. They aren't eating an extra loss of about 340 dollars every series s. If they managed to sell 1 million consoles that would be an over 300 million loss. And that isn't even factoring in the margins for retailers etc. It would be more profitable to just not sell the consoles at that point.

That didn't apply to game consoles.
The tariff isn't based off the retail price. Obviously. How could that possibly work, or even make sense. You'd be paying the government a duty partially based off of the retail sales margin, which is unfathomable.
 
Well obviously. You can't price a tariff off a price of something that hasn't sold. You would price a tariff off the cost paid to carry the product, or build the product. The money going to the government from the tariff charge would have already been paid by the time the product was sold through retail. You can't assess tariffs from a product sold at a Walmart based on the price it sold at off the receipt. Then you would be basing the tariff off the retail margin, which is preposterous and would be hopelessly impractical and impossible to manage. This shouldn't be a difficult thing for anyone to grasp.
That was in response to people trying to calculate tarrif percents on retail prices.

Microsoft already loses money on Series X. Sony likely fluctuates between small profit or loss too.

That BOM is far higher than you think it is.

They may lose money once they write down the high 6 and 7 figure salaries and benefits they pay their army of Xbox hardware engineers, but they're almost definitely not losing money on the BoM.
 
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Many on GAF thinks these tariffs are a great thing so..........


Kanye West Shrug GIF

It would be hilarious if it wasn't so sad. If people think things are bad now, wait till the end of summer if the tariffs are still in place. It will take months for the full effects to be felt.

EDIT: Game price increases are bullshit. Pure greedflation.
 
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Sad to see some users liking the OP. Has it really got to the stage that people will support anything their favourite company announces?

I sometimes use a like as a gesture to the poster that I appreciate them contributing.

I don't get the impression that the people who liked the OP are Xbox fans expressing enjoyment over prices increasing.
 
I think this just helps hasten along the end of the current console business model, as we know it. I began to think that after Nintendo's pricing a month ago with the Switch 2 generation. A lot of people will be driven to simply playing already released games, replaying games because of patches and add-ons, and being extremely picky about buying any new pieces of software. If you're buying a game for $80, you're gonna be very selective and very picky, and probably won't do it very often. So that just makes it less likely new games will sell, and when any do, it'll be the exception to the rule, and make it even harder than it is already for any new hits to emerge, outside of established mega franchises.
 
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This move doesn't make any sense to me, i suppose MS will sell some new consoles at these hiked prices, but not many.
Most likely this is just to soften the blow of them confirming that their first party games are moving to the $79.99 price point.
 
Tarrifs from my understanding only apply to the assembled BoM cost (i.e MS's break even cost), NOT the retail price. So if it costs MS $300 to build a Series X, the tarriffs are levied on $300, not $500.

Yes, correct. But that will pass part of that increase on the $300 onto the customer. This is well understood.
 
Sony has raised prices zero in the US so far. Now are are Mee tooing Sony before they even COPIED MS' greedy move? At the very least wait until the much smaller and poorer Sony raised their prices instead of jumping out in front and taking the brunt of the pushback.

Everyone who thinks this is tariff related, do you think when the trade war is over these prices will go down?

LOL, they won't.

Micrishaft is supposed to be supporting this console by paying for part of it. That's how a subsidy works and why we have had awesome consoles over the years. It wouldn't surprise me if the whole thing wasn't a big loss at MS already and they just don't like throwing good money after bad.

Here's the worst part. Next gen we have been promised a steam machine from MS as their main platform. With no subsidy and no 30% store commission, how much do you think that son of a bitch will cost? This move will doom the Series to obscurity outside of the US for at least the rest of this gen and in the US it will be significantly diminished. If GTA6 releases this year it will be glorious for Sony.

Sony shipped a fuck load of units over before the tariffs hit.

They'd be making some big profits if they were to announce an increase following MS.
 
$80 Microsoft games? Oof....they ain't got a lot of games needing that $80 hit.

Every Activision game will probably surpass that number soon enough if GTA launches at 100.

Sony shipped a fuck load of units over before the tariffs hit.

They'd be making some big profits if they were to announce an increase following MS.

How many, though. I doubt they shipped one year of supply in advance.
 
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Won't sell many of them at that price either lol, Xbox gamers mostly use game pass don't they!.
These game prices will also go up on other storefronts (Steam, PlayStation) where Game Pass doesn't exist.
 
You know I never really considered this but nothing is stopping them from making all their games stupid expensive in a bid to make gamepass more attractive and they own so much of the industry now.

Also GTA is totally gonna be $100.
 
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