Tim Cook: Memory chip scarcity may hike Apple prices
Apple intends to increase prices on its products in response to rising costs associated with memory and storage chips, as stated by CEO Tim Cook in an interview. A surge in AI-driven demand for data centers has compelled consumer electronics companies to engage in intense competition for the limited supplies of essential components, resulting in a significant increase in prices. Organisations representing automakers, retailers, electronics companies, and others had cautioned earlier this month that the rising demand for memory chips could result in significant price increases for consumer goods in the United States and disrupt supply chains.
“Unfortunately, price increases are unavoidable,” Cook told. “We’re doing our best to mitigate the huge increases that are being passed to us, and we’ve been trying to shield our customers from the increases, but the situation has become unsustainable.” Cook, who will transition leadership to John Ternus in September, refrained from revealing the timing or magnitude of potential price increases, as well as the specific products that may be affected. Apple is set to unveil its inaugural foldable iPhone in September, coinciding with the launch of the iPhone 18 Pro and Pro Max.
Memory and storage costs present significant challenges for the company, particularly in relation to the DRAM market, Cook informed. He observed that an increased allocation of supply is directed towards high-bandwidth memory, which is utilised in AI servers. “There’s less supply at a time when consumers want devices and the memory guys are passing along huge price increases,” he said. “We definitely need memory pricing and supply to return to reasonable levels for consumer products. That’s the bottom line.”
China possesses prominent domestic memory and storage enterprises; however, American companies would probably require licenses to engage with them due to national-security regulations. When questioned about the potential easing of restrictions, Cook remarked: “Everything needs to be on the table,” adding, “I think we should look at all supply.” In the interview, Cook indicated that Apple is poised to leverage its cash reserves to enhance memory supply, without providing specifics. “We’re willing to use our balance sheet to help be a part of the solution,” he said. “Obviously, more capacity is needed.”
