Whether it’s iPhones, iPads, or MacBooks, Apple has already slapped revised price tags on a long list of products. Since these products already cost hundreds of dollars more than they did (especially MacBooks and the Mac mini, which use highly capable M-series chips), I was quietly hoping this was it.
However, during its recent earnings call, Apple ended that hope. The company has warned that memory chip prices are climbing at an “unprecedented” pace, with CEO John Ternus telling investors that costs will be even higher in the December quarter (via The Guardian).
Why is Apple’s memory bill exploding like never before?
Here’s the short answer: the ongoing memory and component crisis. As companies double down on AI data centers, bulk demand takes precedence over everyone else, including giants like Apple and Samsung.
Consumer technology giants are essentially bidding against businesses and enterprises willing to pay higher invoice values for memory and chip makers. That leads to a higher final bill of materials.
“Looking beyond the December quarter, we see the pricing for memory purchases continuing to increase,” Ternus mentioned in the earnings call (via Investing.com). An Apple executive also noted how the company’s purchase obligations (read: massive preorders for components) jumped $33 billion from the June to the September quarter.
What is Apple doing to cushion the blow?
In simpler terms, Apple isn’t buying more stuff, but it is doing so at inflated, record-high market prices. While the benefit is that the company can hold prices for a bit longer, the downside is the hefty amount that would eventually eat into margins (decreasing them to between 45 and 46% for the December quarter).
Apple has already passed some of that pain to us. It raised Mac and iPad prices in late June, with the 14-inch MacBook Pro up $300 and the iPad Air up $150, then lifted the iPhone 18 Pro by $100 to $1,199 in September.
Another silver lining is that the company has “offset” the cost “partly” from the June 2026 price hike (one of the ugliest in Apple’s history), the “benefit from carry-in inventory” for the December quarter, and the “lower costs on certain non-memory components.”
Should we prepare for another price hike?
However, the buffer effect will end soon as the inventory depletes. All of this could point to another price hike, but that might put Apple’s products in a largely expensive category rather than borderline expensive, in my opinion.
Given revenue is at a record high ($114.5 billion, up 12%) with iPhone doing most of the heavy lifting, the company shouldn’t run short on funds to fulfill its hardware requirements.
Whether the company wants to do that at a slightly lower gross margin is the question that we might figure out in the coming months.
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