In brief
Apple announced that rising memory chip prices, amplified by an AI boom and supply chain disruptions, will force the company to increase prices for its products. CEO Tim Cook called the price hikes “unavoidable” and highlighted the unsustainable market conditions. It is unclear which devices or when the changes will take effect, but analysts predict that the next iPhone generation could carry a $150 premium and other brands are already raising prices. The trend reflects a broader shift in the semiconductor industry, with key players such as TSMC, Samsung and Sony also citing cost pressures and supply shortages.
Apple to Raise Prices as AI Boom Pressurises Chip Costs
Apple’s chief executive, Tim Cook, told the Wall Street Journal that the company will lift prices for its products because the cost of memory chips has spiked to unsustainable levels. “Price increases are unavoidable,” Cook told reporters, adding that the situation had become “unsustainable” as the supply of chips fell short of soaring demand for AI‑enabled devices.
Cook did not disclose whether a new iPhone model would carry a higher price, but analysts warn that the next generation could cost up to $150 more than the iPhone 17, as Apple upgrades specifications to support advanced AI features.
The price of RAM has more than doubled since October 2025, while a war in Iran has disrupted global helium supplies—a key ingredient for semiconductor manufacturing—further driving up chip costs. Consequently, the average global smartphone selling price is projected to rise 20 % in 2026 to a new all‑time high.
Other technology giants are following Apple’s lead. Samsung warned that memory shortages would raise the cost of consumer electronics, Sony increased prices for its PlayStation 5, and Nintendo announced a price hike for the Switch 2. Even TSMC, the world’s largest chipmaker, said it could raise prices to reflect rising inflation.
Apple’s recent price changes also include the removal of the entry‑level Mac Mini, which pushed its starting price up by about $200 (or £150). With the iPhone 17 already enjoying a 17 % sales surge in early 2026, the company’s pricing strategy appears to be a response to both AI‑driven demand and tightening semiconductor supply chains.
