By Dexerto | Created at 2026-06-11 09:40:44 | Updated at 2026-06-14 10:51:04
3 days ago
Xbox says the company is facing a “hardware component crisis” as rising storage and memory costs continue to put pressure on its console business.
In an internal memo sent to employees, new Xbox CEO Asha Sharma claimed the company is unable to produce enough consoles to meet demand and could soon be paying more than five times as much for key components as it did two years ago.
According to the memo, the price Xbox pays for console storage components was already more than double what it had been the previous fall when Sharma joined as CEO in February.
Xbox CEO warns of “hardware component crisis”
“We are in a hardware component crisis. When I joined as CEO in February, the price we paid for console storage components was over 2x as high as we paid last fall. These costs have since doubled again,” said Sharma via the employee brief.
“As we plan for the 2027 holiday season, we expect another significant increase, taking us over 5x the prices we paid only two years earlier.”
Sharma also added that memory costs have followed a similar trajectory, with the situation reportedly becoming serious enough that Xbox says it cannot keep up with demand for its consoles.
We just shared with our team the realities we need to navigate as we work to reset the XBOX business. We won't succeed by hiding hard truths, nor will we succeed by doing the same thing and expecting different results. See the note here: https://t.co/IahtBNzwnR
— ASHA (@asha_shar) June 10, 2026
“While the entire industry is facing a components crisis, we believe we have been impacted more greatly than many of our peers due to the choices we made over the last half decade,” said the Xbox CEO.
“We are currently unable to make as many consoles as players want to buy, and we need a new business model and partnerships for hardware as we remain committed to Helix.”
Whether rising hardware costs will affect the price of Microsoft’s next-gen console remains to be seen, but we do know that ‘Project Helix’ will be capable of playing both Xbox and PC games.
