Apple to raise prices as AI‑driven chip costs surge
Apple plans to raise the prices of its products as the cost of the memory chips it uses has surged, the technology giant’s boss said.
Tim Cook, Apple’s outgoing chief executive, told the Wall Street Journal that price increases were “unavoidable” as the supply situation around memory chips has become “unsustainable”.
He didn’t say when the hikes would take effect or which products would be affected, and it remains unclear whether the iPhone 18, slated for a September launch, will see a price change.
Memory chips are essential components in smartphones, but the boom in artificial intelligence (AI) has driven their prices up sharply in recent months.
“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, but the situation has become unsustainable,” Cook said.
He highlighted the lack of supply at a time when consumers demand devices and certain chipmakers are passing on large price hikes. Apple will keep pushing for prices and supply to return to reasonable levels for consumer products, he added.
The price of RAM, one of the cheapest computer components, has more than doubled since October 2025.
In addition to the AI‑driven demand, the war in Iran disrupted the global supply of helium – a gas crucial for manufacturing semiconductors – adding to chip costs.
Research firm Omdia expects the average selling price of smartphones globally to rise by about 20% in 2026, reaching a record high.
Omdia’s analyst Chiew Le Xuan said Apple’s new phones could cost up to $150 more than the iPhone 17s due to upgraded specifications that will support new AI features.
Most smartphone brands have already raised prices, pulled back promotions or cut specifications to protect profit margins in response to rising costs.
Other tech giants are also feeling the pressure: Taiwan Semiconductor Manufacturing Company (TSMC) indicated it might raise prices; Samsung warned of memory chip shortages driving up device costs; Sony increased PlayStation 5 prices by £90 in the UK and $100 in the US; Nintendo will raise the Switch 2 price from September due to market conditions.
The iPhone 17 has been popular since its launch last September; Apple device sales grew by 17% in the first quarter of 2026 compared with the same period a year earlier, helped by strong demand in China.
Apple also removed the entry‑level option of its Mac Mini compact computers, raising its starting price by about $200 (about £150) earlier this year.
For more on Apple’s leadership transition, see New era as Apple names new boss to replace Tim Cook after 15 years.
To read about TSMC’s pricing outlook, visit World’s largest chipmaker does not rule out price rises as costs increase.
