CUPERTINO, California — Apple Chief Executive Officer Tim Cook has confirmed that the company plans to raise product prices, citing unprecedented increases in memory and storage chip costs driven by surging demand from artificial intelligence data centers.
In an interview with The Wall Street Journal published on Tuesday, Cook acknowledged that price increases are now “unavoidable” after the company exhausted efforts to absorb the rising costs. He declined to specify which products would be affected, the timing of changes, or the magnitude of increases.
“Unfortunately, price increases are unavoidable,” Cook said. “We are doing everything we can to mitigate the massive cost increases being passed on to us, and we have been working to protect our customers from price increases, but the situation has become unsustainable.”
Supply Constraints
The shortage stems from AI companies’ insatiable appetite for high-bandwidth memory chips used in servers, which has severely constrained supply available for consumer electronics. According to industry data, memory and storage chip prices have quadrupled since 2024, with analysts expecting the upward trend to continue through 2027.
“Memory manufacturers are passing on massive cost increases to the market while supply for consumers is decreasing at the very time people need devices,” Cook stated. “We really need memory pricing and supply to return to reasonable levels for consumer products. That is the fundamental issue.”
Three companies dominate the DRAM memory market: Samsung and SK Hynix from South Korea, and Micron from the United States. NAND flash storage manufacturers include these three companies along with Kioxia and SanDisk.
Market Impact
Apple has already adjusted its product lineup in recent months. The Mac Mini saw its starting price increase from 599 dollars to 799 dollars after Apple discontinued the lowest-tier configuration. Dell and Nintendo have also raised prices on their products.
Research firm TechInsights estimates that to maintain profit margins, the next-generation iPhone 18 Pro could require a price increase of approximately 270 dollars, potentially bringing its price to 1,299 dollars. Morgan Stanley projects that U.S. smartphone and personal computer prices could rise 15 percent this year.
Apple is prepared to leverage its substantial cash reserves to secure additional chip supplies, though Cook clarified the company has no plans to build its own memory and storage chip factories. “We cannot do everything ourselves,” he noted. “We know where our strengths lie.”
Apple is expected to unveil its iPhone 18 lineup in September, which may include a new foldable iPhone model.