Back to Headlines
Tech
Jun 18, 2026
Analyzed by Llama- 4 Scout 17B 16E Instruct

Apple Warns of iPhone Price Hikes Due to AI-Driven Memory Chip Shortage

AI Summary
Apple's outgoing CEO Tim Cook warns that the company's products, including iPhones, may become more expensive due to a global shortage of memory chips driven by AI's insatiable demand for hardware. The shortage has caused chip costs to surge fourfold since last year.

The Impact of AI on Apple's Hardware Costs

The worldwide shortage of memory chips, dubbed 'RAMageddon,' has been caused by AI's insatiable demand for hardware. This shortage has led to a significant increase in memory and storage chip costs, which could result in price hikes for Apple's products.

Price Increases Are 'Unavoidable'

In a recent interview with the WSJ, outgoing Apple CEO Tim Cook warned that price increases are 'unavoidable' due to the surging costs of memory and storage chips. Despite efforts to absorb these costs, which have increased fourfold since last year, Cook described the situation as 'unsustainable.'

Potential Price Hikes for Apple Devices

  • Cook didn't specify which products will be affected or when prices will rise.
  • The iPhone seems likely to be impacted, according to memory supply experts.
  • Research firm TechInsights estimates that Apple would need to add another $270 to the next iPhone Pro to keep its profit margin intact.

The Broader Impact on Apple's Business

AI has not yet been a significant boon to Apple, and the company is under pressure to develop its AI strategy for its devices. Apple has faced challenges in delivering AI features, including a $250 million settlement earlier this year to end a false advertising lawsuit.

The Future Outlook

Apple's Worldwide Developers conference earlier this month showed progress on fulfilling previous AI promises, including an overhaul of Siri. However, more on-device processing could lead to increased demand for memory, potentially resulting in higher prices for Apple products.