GoKawiilRipple effect: As demand from AI data centers pushes memory and storage costs to stratospheric highs, hardware manufacturers across the tech industry have raised prices while seeing shipments decline. Apple's outsized supply chain muscle has mostly shielded it from the trend so far, but the tech giant's CEO recently admitted that even it can't simply absorb rising component costs forever.
Apple CEO Tim Cook recently told The Wall Street Journal that raising prices across its product lineup will become unavoidable this year due to continually inflating memory costs. The company has not yet determined which devices will see hikes or how severe they will be, but WSJ estimates that base-model iPhones could rise by more than $200.
Since AI data centers began siphoning most DRAM and NAND production capacity last year, building PCs with DDR5 RAM has become virtually impossible, the retail SSD market has almost vanished, and knock-on effects have cascaded throughout consumer tech.
Smartphones shipments recently hit historic lows, game consoles are nearing the $1,000 mark, and PC manufacturers are resurrecting older hardware. Microsoft recently confirmed that it now pays four times as much for memory as it did late last year, and memory now represents most of the Nothing phone's bill of materials.
Apple's products have not experienced anything nearly as severe thus far. In fact, the company recently released a $599 MacBook that sent shockwaves throughout the laptop industry. Apple is even expected to double production of the MacBook Neo, although it remains unclear how or if it plans to maintain its record-low entry price.
Cook stated that, while Apple has attempted to minimize the impact of rising memory costs while maintaining its profit margins, the situation has become unsustainable. The company has traditionally enjoyed a privileged position among supply chain customers, but the AI wave has managed to outmuscle even the Cupertino giant.
The full extent of the damage is expected to become public when the company unveils the iPhone 18 and likely the iPhone Ultra in September, but prices of Macs and iPads might rise sooner. The CEO called the situation the worst price swing he has seen in his 40 years working in electronics, describing it as a hundred-year flood.
Even aside from the RAM crisis, Apple's fall 2026 hardware lineup was already expected to be expensive. Experts estimate that the foldable iPhone Ultra will start at no less than $2,000. Furthermore, the only other new iPhone debuting this year will likely be the iPhone 18 Pro, as the standard iPhone 18 is not expected to arrive until 2027. The MacBook is also anticipated to receive an Ultra-tier device this year, featuring a touchscreen and Apple's yet-to-be-announced M6 processor.
Experts expect memory costs to remain elevated beyond 2027.