Apple says product prices may go up because a key part used in its devices has become much more expensive. According to Apple CEO Tim Cook, the company is facing major cost pressure from memory and storage chips used in products like iPhones, Macs, and iPads, as per Tim Cook interview with The Wall Street Journal.
The problem is mainly linked to the rapid growth of artificial intelligence (AI). As AI becomes more popular, companies are buying huge amounts of memory and storage chips to power AI systems and servers. Apple CEO Tim Cook said in the interview that price increases can no longer be avoided. Cook told The Wall Street Journal that Apple has tried to absorb higher costs for as long as possible, but the situation has become too difficult to continue.
Apple tries to hold prices down
Cook said Apple has been trying to protect customers from higher prices. However, he explained that suppliers are passing on large cost increases to Apple, making it harder for the company to keep prices unchanged. Apple has not confirmed exactly when prices will rise. Cook did not provide details about the timing, the size of any increase, or which products would definitely be affected.
iPhone 18 and chip supply concerns
Apple’s next major product launch is expected in September, where the company is likely to unveil its new iPhone 18 lineup. Some Apple products could see price increases even before the new iPhones arrive. The Wall Street Journal reported that Macs and iPads could become more expensive sooner.
AI boom drives chip demand
Large AI data centers and servers are now consuming massive amounts of storage and memory chips, creating strong competition for supply. Apple is now finding it harder to secure enough chips. Prices for memory and storage chips have surged dramatically.
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According to TechInsights cited by The Sun, DRAM and NAND prices have increased fourfold over the past year. The sharp rise started after major tech companies boosted AI spending. Google, Microsoft, Meta, and Amazon raised their spending plans to invest more in AI technology and data centers.
Memory chip prices keep rising
Cook said there is not enough supply to meet demand. He explained that chip makers are raising prices while consumers still want to buy devices, creating a difficult situation for companies like Apple. Apple wants memory chip prices to become more reasonable again.
iPhone 18 pro could cost more
Apple says that strategy cannot continue forever. According to the WSJ report, the additional costs are becoming too large for the company to keep covering on its own. A Wall Street Journal calculation suggested the iPhone 18 Pro could cost about $1,299, roughly $270 more than current pricing, because of higher component and manufacturing costs. The increase would be driven by more expensive memory chips, new AI-related features, camera upgrades, and other production costs.
AI features are increasing the amount of memory needed inside smartphones. This adds to Apple’s production costs because more DRAM is required for advanced AI functions. Cook described the situation as unlike anything he has seen before. He said that in more than 40 years working in technology, he has never witnessed such extreme swings in memory and storage prices. Cook compared the current market conditions to a once-in-a-century disaster. He called the situation a “hundred-year flood” to emphasize how unusual and severe it is.
Apple says the AI boom has created a shortage of memory and storage chips, causing prices to soar. Tim Cook warns that Apple may soon have to raise prices on products such as the iPhone 18 Pro because the company can no longer absorb all of the extra costs, as per Tim Cook interview with WSJ.
