Tim Cook: Apple will increase prices due to overwhelming demand for memory chips.
Tim Cook in an interview with the Wall Street Journal (gift link):
“Unfortunately, price increases are unavoidable,” he said. “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 declined to offer details on the timing or scale of the planned price increases, nor which products would be affected. Apple’s next major product launch is likely to be in September when it releases the iPhone 18 lineup, expected to include a new foldable iPhone.
Price increases, especially for Macs and iPads, could come sooner. Apple raised the starting price of the Mac Mini last month in between launch events.
Skyrocketing demand for memory and storage chips from artificial-intelligence companies has pushed up their cost so much that Apple would have to raise device prices substantially to maintain its profit margins. Passing the higher cost on to consumers while maintaining its profit margin would add about $270 to the price of the next iPhone Pro model, estimates research firm TechInsights. […]
Cook said during his time working in the electronics supply chain, from IBM to Compaq to Apple, he had never seen a commodity price swing like the one from the past six months. “This is a hundred-year flood,” said Cook. “I’ve never seen anything like it in any area in over 40 years.”
Wow.
Wow, not because prices are going to go up, but this is the first time Apple has explicitly mentioned price increases to my recollection.
Apple has discontinued the base models of certain products such as the Mac mini and iPhone 17 Pro in order to raise the base price of these devices, but they have also changed their AppleCare+ structure by mandating the Theft and Loss option and getting rid of the two-year option, raising the price of the service across the board for most products.
You can call it a passive aggressive approach to price increases, or a “tell me you’re going to increase prices without telling me you’re going to increase prices” moment, except now Apple is telling us they’re going to increase prices.
My assumption is Apple Watch Series 12 and Apple Watch Ultra 4 will also get increased pricing because of increased RAM requirements for the new Siri AI. Apple’s goal is to raise prices across the board from hardware to services to ease consumer burden, but this isn’t looking good for iPhone Ultra pricing.