Xbox CEO Asha Sharma has laid out the numbers in a memo that reads like a quarterly report drained of all optimism. Storage component costs have already doubled twice since her February arrival, with projections showing they will exceed five times the levels from two years prior by the 2027 holiday window. Memory follows the same trajectory, driven by AI demand pulling supply away from consumer hardware.

The executive describes the situation as unsustainable and calls for new business models and partnerships while remaining committed to Project Helix, the next console effort. Production shortfalls mean Xbox cannot meet current demand for existing hardware, let alone scale to a more expensive successor without adjustments.

Industry-wide shortages tied to AI infrastructure explain the price trajectory, though Sharma notes Xbox feels it more acutely due to prior decisions. Flexible pricing and design changes are under consideration to avoid simply passing the full burden to buyers.

This is the hardware gap that cannot continue, presented in the flat language of metrics and timelines.