Outgoing Apple CEO Tim Cook has acknowledged that the company will raise prices on certain products, as the cost of memory chips—driven by surging demand from artificial intelligence infrastructure—becomes too steep to absorb. In an interview with The Wall Street Journal published Wednesday, Cook described the increases as “unavoidable,” signaling that consumers across Europe and beyond may soon pay more for iPhones, Macs, and iPads.
The warning underscores a broader trend: the AI boom has transformed the memory-chip market, pitting consumer electronics giants like Apple directly against major AI companies and data-centre operators for limited supply. According to a recent Morgan Stanley estimate, memory-chip prices have climbed more than sixfold over the past year as manufacturers struggle to keep pace.
European Consumers in the Crosshairs
For European buyers, already grappling with inflation and higher living costs, the prospect of pricier Apple devices adds another layer of financial pressure. Apple’s flagship products—including the iPhone, MacBook, and iPad—are popular across the continent, from Berlin to Barcelona. The company has not specified which models or markets will be affected, but the ripple effects could be felt in major retail hubs like Paris, Milan, and Stockholm.
Morgan Stanley’s analysis highlights the scale of the challenge: if manufacturers were to offset higher memory costs entirely through pricing, average selling prices would need to rise by roughly 34% for smartphones, 67% for personal computers, and 83% for servers. While these figures are not forecasts, they illustrate the cost pressures facing the entire technology sector.
“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 told the newspaper.
Memory Components at the Core
The cost surge is concentrated in two types of memory chips: DRAM, used for short-term memory, and NAND flash, used for permanent data storage. Both are essential for AI systems and consumer electronics alike. Research firm TechInsights estimates that memory and storage components in the iPhone 18 Pro could cost Apple about $196, up from roughly $52 in the iPhone 17 Pro—a nearly fourfold increase.
This development comes as Apple prepares for a leadership transition. Cook is due to be succeeded by John Ternus in September after 15 years at the helm. The timing adds uncertainty for investors and consumers alike, as the new CEO will inherit a company navigating a volatile supply chain.
Apple’s warning also raises concerns about broader inflation across the technology industry. If other manufacturers follow suit, European consumers could see higher prices for a range of devices, from laptops to tablets. The situation echoes recent trends in the semiconductor market, where AI-driven demand has reshaped pricing dynamics.
For now, Apple has not disclosed the magnitude of any price increases or which products will be targeted. But the message from Cupertino is clear: the era of absorbing chip costs is over.
