Apple signals price hikes as chip costs surge amid AI demand

The move comes as a global surge in AI-driven demand for data centres intensifies competition for semiconductor components, pushing memory chip prices higher and tightening supply across the consumer electronics industry.

Industry groups representing automakers, retailers, and electronics manufacturers have already warned that escalating demand for memory chips could trigger significant price increases in consumer goods and disrupt global supply chains.

Cook acknowledged the pressure, stating that “price increases are unavoidable” as Apple attempts to absorb rising costs while limiting the impact on customers.

“We are doing our best to mitigate the sharp increases being passed on to us, and we have tried to shield our customers, but the situation has become unsustainable,” he said.

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The Apple chief executive, who is expected to hand over leadership to John Ternus in September, did not specify when price adjustments would take effect or which products would be affected.

Apple is reportedly preparing to launch its first foldable iPhone in September, alongside the iPhone 18 Pro and Pro Max models, as part of its upcoming product cycle.

Memory and storage pricing, particularly in the DRAM segment, remains a key concern for the company. Cook noted that increasing allocation of high-bandwidth memory for AI servers has further strained supply for consumer devices.

“There is less availability at a time when demand for devices remains strong, and memory suppliers are passing on substantial price increases,” he said. “Memory pricing and supply need to return to reasonable levels for consumer products.”

Cook also suggested that regulatory and trade considerations surrounding global chip supply chains remain under review, adding that “everything needs to be on the table” when addressing long-term supply stability.

He indicated that Apple is prepared to leverage its financial strength to support improved memory supply, though he did not disclose specific measures.

“We are willing to use our balance sheet to be part of the solution. More capacity is clearly needed,” he said.

However, Cook ruled out the possibility of Apple manufacturing its own memory and storage chips in-house.

The comments come at a time when the broader tech industry is grappling with soaring component costs driven by AI expansion, with analysts warning that further price adjustments across consumer electronics may follow if supply constraints persist.