GoKawiilApple is expecting "significantly higher memory costs" heading into the remainder of 2026, CEO Tim Cook said Thursday during Apple's second-quarter earnings call, as the tech giant faces down the memory shortage impacting the rest of the industry.
Cook -- who is stepping down as CEO on Sept. 1 and will be replaced by John Ternus, the company's senior vice president of hardware engineering -- said Apple was partially unaffected by the memory shortage during this quarter, as it already had a lot of devices in stock. But beyond June, costs will rise.
"We believe memory cost will drive an increasing impact on our business, and we'll continue to evaluate this," Cook said. "We'll look at a range of options."
As AI data centers continue to be built to meet increasing demand for AI services, their need for memory and other components has reduced the supply for consumer devices, driving up the costs of laptops and phones like Apple's MacBooks and the iPhone, as well as external storage products.
Analysts are looking at how Apple will meet demand amid increased memory costs and supply constraints in the coming quarters, said Nabila Popal, senior research director at the International Data Corporation.
"While Apple remains better positioned than its competitors to manage the memory crisis and get the supply it needs, the key question will be deciding the perfect balance strategically between increasing prices and maintaining profitability or focusing on gaining share by not increasing prices," Popal said.
Cook said the current primary constraint is the "availability of advanced nodes our SOCs are produced on," rather than memory, which has affected the iPhone. Going forward, he said this would likely also impact the Mac Mini, Mac Studio and MacBook Neo in particular, given their artificial intelligence tools and popularity.
Customers have pounced on the desktop Mac Mini and Mac Studio to use with AI agents, Cook said, and it may take several months for the supply of those computers to recover. He didn't say when the MacBook Neo would be restocked to meet demand.
"The customer response to Mac Neo has just been off the charts, with higher-than-expected demand and the March quarter record for customers," Cook said.
Overall for the quarter, Apple announced revenue of $111 billion, up 17%, which Cook largely attributed to the "extraordinary demand for the iPhone 17 lineup."
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