Market AnalysisJun 23, 20262 Min
Apple to raise iPhone prices as memory chips get costlier
Apple’s chief executive Tim Cook said on Wednesday that the company was planning to raise prices of its products – iPhone, Mac and iPad – to offset the sharp jump in costs of memory chips.
In an exclusive interview with The Wall Street Journal, Cook said: “Unfortunately, price increases are unavoidable.”,” he said. “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…”
However, the situation has become “unsustainable”, Cook highlighted. The company can no longer absorb the increases driven by global demand for artificial intelligence (AI) server memory and storage, he added.
Notably, Cook didn’t give any further details on which products would be more expensive and by how much.
Markets read Cook’s statements as preparing grounds for a costlier-than-expected iPhone 18 that is likely to be launched in September. Tech enthusiasts believe that the line-up could cost up to $200 over and above the iPhone 17 prices.
A Forbes report said Apple may continue to eliminate lower-tier storage options, effectively increasing the base price, as seen with the Mac Mini.
Apple had discontinued the 256GB storage model of its M4 Mac Mini earlier in May. As a result, the cheapest variant now costs $799 instead of $599. The development comes after Apple stopped selling the Mac Studio with 512GB of storage in March and launched the new MacBook Air with a higher starting price.
Higher chip costs
Growing shortage of memory and storage chips are driving the increase in electronic hardware prices. These chips are two critical components used in devices like smartphones, tablets and laptops.
Huge investments in development of new AI systems and data centres have created massive demand for these chips, pushing prices higher.
The WSJ report cited a company called Techinsights as saying that the memory and storage components inside the iPhone 18 Pro are likely to cost Apple an extra $150 for parts alone, compared to the iPhone 17.
The need to support new Apple Intelligence features further necessitates usage of more advanced chips, making price hikes unavoidable.
Apple to buy chips from Intel
US President Donald Trump said in a Truth Social post on Thursday that Apple had agreed to work with Intel to design and build its chips in the US.
Intel had earlier reached a preliminary deal to make some chips for Apple, following discussions that went on for more than a year, the Wall Street Journal reported in May.
Apple currently relies heavily on TSMC (Taiwan Semiconductor Manufacturing Company), which is the primary maker of its iPhone and Mac chips. TSMC’s advanced production lines are in high demand from AI chipmakers such as Nvidia and AMD, which makes it harder for Apple to secure priority production space. The Intel deal will help Apple diversify its manufacturing base as it seeks more chip capacity.
Apple’s latest AI tools
Apple on Thursday shared a 90-minute WWDC26 presentation recorded live at the Steve Jobs Theater. The video features demos of its latest AI tools for developers and an entire app built from just a few prompts.
An interesting part of the video is a 20-minute segment in which an entire app is built from a single prompt and then further tweaked with follow-up commands.
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