Apple plans price hikes as chip costs surge, AI demand bites

Apple prepared to raise prices on its products as surging AI demand tightened supplies of memory and storage chips, a shift that could soon reach the phones, tablets and laptops consumers buy every day. Tim Cook said price increases were unavoidable, signaling that the company’s long effort to shield customers from broad hikes was becoming harder to sustain.

The pressure centered on DRAM and NAND memory, components now caught in a fierce contest between consumer electronics makers and data center operators building AI systems. As those servers absorbed more supply, prices for key chips climbed sharply, raising costs across the hardware chain and leaving Apple with fewer ways to absorb the hit without passing some of it on.

Cook did not say when the higher prices would arrive or which products would be affected first. Analysts and industry observers said Macs and iPads were likely to be among the earliest devices to move up in price, since they depend heavily on those components and tend to give Apple more room to adjust configurations and margins than its flagship phone line.

The iPhone remains the biggest test of how far Apple can push without damaging demand. One market estimate suggested the iPhone 18 Pro could rise by as much as $270, and some analysts warned the broader iPhone 18 lineup could face higher pricing later in 2026 if the memory shortage persists. That would mark a notable break from Apple’s usual reluctance to impose broad, visible hikes on core products.

Cook said Apple would look at a range of options, including changes in pricing and longer supplier agreements, as it tries to blunt the impact of component inflation. The stakes extend beyond Cupertino: if Apple moves first, competitors facing the same chip squeeze may follow, turning an AI-fueled parts shortage into a wider consumer electronics price reset.