There has been a lot of recent discussion around skyrocketing memory chip prices and how they might impact Apple devices, particularly the upcoming iPhone 18 Pro. The surge in prices for DRAM and NAND storage chips has been driven by increased demand from companies building AI servers, with reports indicating that even chip giants like TSMC, Samsung, and SK Hynix are struggling to keep up with supply despite operating at full capacity.
Impact of Rising Memory Chip Prices on Apple
The high demand for memory chips, particularly in AI sectors, has caused an imbalance in supply and demand. This has allowed chipmakers to raise prices, with Taiwanese research firm TrendForce estimating that DRAM contract prices could rise by as much as 90-95% and NAND prices could increase by 55-60% in the current quarter compared to the last.
Apple, as one of the world’s largest electronics makers, still holds significant leverage, but it is not immune to the pricing pressure. CEO Tim Cook acknowledged on a recent earnings call that these rising chip prices would have “a bit more of an impact” on Apple’s gross margin in the current quarter. However, Apple forecasted a 13% to 16% increase in revenue year-over-year, signaling expected growth despite the challenges.
Apple’s Response to Rising Chip Prices
Cook mentioned that Apple would “look at a range of options to deal with” the price increases, though no specific measures were mentioned. While some suppliers expect Apple to intensify cost-cutting demands, it is unclear whether this will affect DRAM and NAND suppliers directly or if Apple will find savings elsewhere in the supply chain.
Apple has a strong track record of managing its supply chain and minimizing the impact of cost increases on consumers. This is particularly important as Apple historically avoids passing on price hikes to customers whenever possible.
iPhone 18 Pro Prices Likely to Stay Flat
Despite the rising chip prices, it seems unlikely that Apple will raise iPhone 18 Pro prices. Supply chain analyst Ming-Chi Kuo has indicated that Apple’s current plan is to “avoid raising prices as much as possible” for the iPhone 18 Pro models. He predicts that Apple will “at least keep the starting price flat,” meaning the iPhone 18 Pro models will likely not be more expensive than the iPhone 17 Pro models.
While Kuo was specifically referring to the starting prices of the iPhone 18 Pro, it remains unclear whether Apple will increase prices for storage upgrades or other options. Historically, Apple has been very cautious about raising iPhone prices and has focused on negotiating favorable terms with suppliers to maintain pricing stability.
Despite the rising costs of memory chips, Apple’s strong supply chain and history of strategic pricing decisions suggest that the iPhone 18 Pro will likely remain competitively priced, or at least maintain the current pricing structure, even as memory chip prices soar.
