Apple CEO Tim Cook confirmed that price increases are unavoidable for the company's products, citing significant hikes in the cost of memory and storage chips. He stated that Apple has been trying to absorb these increases but the situation has become "unsustainable." This follows a period where Apple has attempted to shield customers from rising component costs by mitigating the impact.
The rising costs are primarily driven by the insatiable demand for high-bandwidth memory and enterprise solid-state drives, fueled by the rapid expansion of AI infrastructure. S&P Global Ratings has warned that memory prices are expected to remain elevated at least through 2028 due to tight supply. Cook noted that he has never witnessed a commodity price swing of this magnitude in his four decades in the technology industry.
While specific product price increases and their timing remain unclear, Macs and iPads are expected to be among the first to see higher price tags. Apple already raised the starting price of its Mac Mini in May by dropping the cheaper base configuration. Analysts anticipate that the upcoming iPhone 18 Pro could cost around $1,299, a jump from the iPhone 17 Pro's $1,099, and a rumored foldable iPhone Ultra could debut at approximately $1,999. These premium tiers might help Apple absorb component costs while potentially allowing mainstream iPhone 18 pricing to remain steady.
Other companies are also facing similar pressures, with Microsoft's new Surface Pro 13-inch and Surface Laptop already priced roughly 50% higher than prior generations, with AI-driven memory shortages cited as a central reason for the jump. Apple's fiscal Q3 2026 earnings call, tentatively scheduled for July 30, will be a key opportunity for analysts to assess the margin impact of these elevated memory costs and press management for a firmer timeline on product price increases.
