Analysts forecast sustained rise in video game hardware prices

Gaming hardware prices are expected to keep climbing in the coming years due to rising component costs and other factors. Industry experts point to increased demand for RAM from AI data centers as a primary driver. They also cite tariffs, inflation, and geopolitical issues as contributing elements.

Valve raised prices on its Steam Deck by more than $200 last week. The Nintendo Switch 2 faces a small price increase later this year, while Xbox and PlayStation 5 consoles have seen multiple price hikes in recent periods. Analysts attribute the increases mainly to a RAM supply shortage caused by demand from AI data centers. Joost van Dreunen of NYU Stern noted that U.S. tariffs have added volatility and pushed manufacturing elsewhere. Dr. Serkan Toto of Kantan Games highlighted persistent global inflation and geopolitical turmoil such as the Iran war. Most analysts expect prices to continue rising until at least 2027 to 2029. Rhys Elliott of Alinea Analytics described current increases as lagging indicators tied to expiring supply contracts. James McWhirter of Omdia predicted further Nintendo Switch 2 price increases in 2027. Experts remain uncertain about any eventual decline. Tiago Reis of Newzoo said the pricing floor for hardware is likely higher than before 2026. Mat Piscatella of Circana noted that gaming still offers many low-cost or free options through mobile and free-to-play titles.

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Illustration of PlayStation 6 console on factory line with rising manufacturing cost charts to $1000.
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PlayStation 6 manufacturing costs rise toward $1,000

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A hardware leaker reports that Sony's bill of materials for the PlayStation 6 has increased to around $900. Sony stated it does not intend to sell hardware at significant losses.

Nintendo has provided details on its decision to raise the price of the Switch 2, citing persistent rises in memory and other component expenses that are expected to continue.

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Apple CEO Tim Cook stated that high memory costs will significantly impact the company's business in coming quarters. He highlighted supply constraints during the latest earnings call despite strong revenue growth. The issue stems from skyrocketing RAM prices driven by AI data center demand.

Former PlayStation and Sega executives Shawn Layden and Peter Moore say console makers must innovate to justify rising hardware prices driven by AI chip demand.

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Nintendo announced it will increase the price of the Switch 2 console by $50 starting September 1 in the US. The move affects the base model amid rising component costs and follows similar adjustments in other markets.

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