Apple is feeling the heat from skyrocketing costs for key components, and it looks like iPhone users might finally see some price hikes after years of the company trying to avoid them. CEO Tim Cook has basically said increases across the lineup are now pretty much unavoidable, thanks to a massive surge in memory and storage chip prices driven by the huge AI boom.
In an exclusive interview with The Wall Street Journal, Cook explained that Apple had been absorbing these rising costs for as long as possible. “We’re doing our best to mitigate the huge increases that are being passed to us, and we’ve been trying to shield our customers from the increases,” he said, but added that things have reached a breaking point.
The main issue is fierce competition for DRAM (memory) and NAND (storage) chips. Big AI players like Google, Microsoft, Meta, and Amazon are snapping up tons of high-bandwidth memory for data centers, which has caused prices for both DRAM and NAND to quadruple since last year. Suppliers like Samsung, SK Hynix, and Micron are prioritizing those lucrative AI deals, leaving less for consumer gadgets and creating shortages that could drag on into 2027.
Analysts at TechInsights figure this could tack on something like $270 to the price of a future iPhone Pro model. Cook didn’t spell out exactly which products or when the hikes might hit, but Macs and iPads could see changes sooner, and people are watching the iPhone 18 series (and the first foldable iPhone) closely this September. Apple already bumped up the starting price on the Mac Mini as a bit of an early signal.
Cook called the situation a “hundred-year flood”, unlike anything he’s seen in his decades dealing with the supply chain. He’s hoping memory pricing and supply will eventually calm down for regular consumer products, and mentioned Apple might use its strong balance sheet to lock in more capacity. Still, going up against those multi-year, high-prepayment AI contracts is tough.
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