Apple Raises Product Prices Amid Astronomical Memory Chip Costs

Surging memory chip prices are pressuring the profit margins and revenue guidance of Apple Inc., a crisis driven by the global race to build AI infrastructure. The shortage stems from intense demand for high-bandwidth memory and advanced DRAM used in AI servers, leaving major suppliers like SK Hynix, Samsung Electronics, and Micron largely sold out of premium capacity through 2026.

Apple CEO Tim Cook described the market as a "100-year flood on the memory pricing," stating that the company reluctantly raised prices on products including Macs and iPads to offset these costs. The situation is echoed by Nvidia Corporation CFO Colette Kress, who characterized recent price increases for memory chips as "astronomical." Kress noted that some companies have secured capacity without knowing the final quantity or price they will receive.

Analysts expect these supply constraints to persist into 2027. This prolonged shortage is expected to continue impacting Apple's gross margins through the September quarter.