Console gaming's pricing crisis hit a new low in May. Both Xbox and PlayStation recorded their worst May unit sales in US history, driven by relentless price increases that show no signs of stopping.
PlayStation volume plunged 58% year-over-year, falling to their lowest May total since 2000. The damage followed Sony's April price hikes that pushed the standard PS5 to $649.99, the Digital Edition to $599.99, and the PS5 Pro to $899.99.
Microsoft raised Xbox prices by $20-$70 last October and just announced another increase of $100-$150 per unit, effective August. Xbox unit sales fell 12% from last year, though spending rose 7% as each console now costs more.
The average price paid for a new console hit $502 in May, up 14% from $440 a year ago. PS5 buyers paid an average of $672 (up 33%), while Xbox Series buyers averaged $524 (up 22%).
Circana analyst Mat Piscatella summed up the situation bluntly. "Xbox also recorded its lowest May hardware unit sales ever," he told Kotaku.
"So, I guess we could call the results, uh, mixed? Xbox is currently tracking a distant third in hardware sales among the major manufacturers. But. They are getting more revenue from each unit sold."
The root cause is a component-cost crisis that keeps getting worse. Console manufacturers have seen storage and memory prices climb 2x to 5x in recent years as semiconductor producers shift capacity to high-margin AI hardware.
Microsoft warned this week that storage costs are expected to double again by fall 2027, suggesting the price hikes are structural, not temporary. The costs have gotten so extreme that Microsoft discontinued its 2TB Xbox Series X entirely, it would have needed a price tag above $1,000. The 1TB Series X now sits at $800.
Nintendo remains the outlier. The Switch 2 posted a 38% sales increase over last May and has sold 5.9 million units in its first year in the US, making it the second-fastest-selling console in American history behind only the Game Boy Advance.
Nintendo has so far only raised the Switch 2's price by $50. The implications for the next generation are grim. Reports widely peg the PS6 for a 2027 launch, but with the PS5 already struggling at $650 and component costs still climbing, analysts expect the PS6 to debut above $1,000, potentially approaching $1,500.
Xbox's next-gen console faces the same math.
Overall US gaming spending hit $4.2 billion in May, up 3% year-over-year. Software and accessories kept the industry afloat, 007 First Light led game sales, and racing accessory revenue surged 95% thanks to Forza Horizon 6, even as the category posted its lowest May unit volume since the Xbox 360 era.
