According to this article, it is 'guestimated' that Apple may need to raise prices on their products. The article explains why. So, if you might be in the market to purchase an Apple product, sooner might be better than later.
My old iPhone X was introduced in 2017, but it still functions fine, so I'll keep using it.....Jim H
Thoughtful, detailed coverage of everything Apple for over 30 years
22 June 2026
#1809: Apple to raise prices
Tim Cook has confirmed what many feared: Apple will raise prices due to skyrocketing memory and storage costs driven by AI demand. Adam Engst breaks down the math to show what this could mean for iPhone pricing. Glenn Fleishman has launched Fruit Specs, a powerful new website for slicing and dicing Apple hardware and software features—a must-visit for anyone researching Apple products. Adam also investigates a confusing iOS 26 interface quirk where dragging apps to the Hidden folder doesn’t work as expected. We briefly link to Ryan Moulton’s fascinating explanation of why your screen can’t display certain real-world colors and BasicAppleGuy’s comparison showing how macOS 27 Golden Gate improves on macOS 26 Tahoe’s blurry Liquid Glass icons. Notable Mac app releases this week include 1Password 8.12.24, Bookends 15.4.1, DEVONthink 4.3.2, Firefox 152.0.1, and OmniFocus 4.8.12.
ADAM ENGST 18 June 20265 comments
Tim Cook Confirms Apple Will Raise Prices Due to Memory and Storage Costs
In “iPhone and Services Drive Apple to Record Q2 2026 Despite Supply Constraints” (1 May 2026), Michael Cohen and I wrote:
the more revealing guidance came from Cook, who warned that memory costs would be “significantly higher” next quarter due to memory manufacturers redirecting output to AI chips. It’s going to get worse before it gets better, as Cook noted, saying, “beyond the June quarter, we believe memory costs will drive an increasing impact on our business.” Apple can absorb some of that impact thanks to its scale and margins, but only up to a point.
That point has now arrived. In an exclusive interview with the Wall Street Journal’s Rolfe Winkler, outgoing Apple CEO Tim Cook acknowledged that the company would have to raise prices to account for the soaring costs of memory and storage chips, driven by demand from AI companies. The article is behind a paywall, but you can watch the summary video for free.
Winkler suggests in his summary that Apple has absorbed the cost increases so far because it has always treated memory and storage upgrades as profit centers. That’s no surprise to the Apple community, which has long chafed at Apple’s premium prices for memory and storage. But now, for instance, the price of standalone internal flash storage is closer to and sometimes even higher than Apple’s upgrade prices.
Calculating Possible Price Increases or Margin Hits
Winkler quotes research firm TechInsights as saying that the cost of memory and storage in an iPhone 17 Pro was about $50 last year, but the same components for the upcoming iPhone 18 Pro would be about $200. Apple’s gross margin on hardware was 38.7% in Q2 2026, down from 40.7% in Q1 2026. We don’t know the iPhone 17 Pro’s specific margin—as a premium product, it’s probably higher than average—but let’s use 38.7% for illustration. For a 256 GB iPhone 17 Pro that retails for $1100 and has a 38.7% margin:
Profit would be $1100 × 0.387 = $425.
Cost of goods would be $1100 – ($1100 × 0.387) = $675.
The estimated memory/storage portion of the cost of goods is $50.
So, for a hypothetical iPhone 18 Pro:
The increase in the estimated memory/storage cost is $200 – $50 = $150.
The estimated cost of goods would be $675 + $150 = $825.
To maintain the $1100 price, the profit would fall to $1100 – $825 = $275.
At a price of $1100, the resulting margin would be $275 ÷ $1100, or 25%.
To maintain a 38.7% margin, the price would be $825 ÷ (1 – 0.387) = $1345.
In raw dollars, the price increase would be $1345 – $1100 = $245.
As a percent increase, it would be ($1345 – $1100) ÷ $1100 × 100 = 22.3%.
Again, these numbers are almost certainly off because the iPhone 17 Pro likely has a higher gross margin, and we don’t know how other component prices might change over the year, especially with Apple’s volume purchasing abilities. The point, however, is that a $150 increase in the cost of goods would only result in a $150 price increase if Apple were willing to accept a gross margin of ($1250 – $825) ÷ $1250 × 100 = 34%.
Obviously, Apple could absorb such costs and more if it were to accept dramatically lower gross margins. But as high-minded and customer-focused as Apple is, the company is still in business to maximize profit.
Should You Buy Now?
Practically speaking, if you’re pondering the purchase of a new Mac, iPhone, iPad, or Apple Watch, you might consider making it sooner rather than later. Historically, I would have recommended that anyone in the market for a new iPhone wait until the new models appear in September, for instance, but it might make sense to buy one of today’s models instead if it’s $250 less. We don’t know when Apple will raise prices, but it would be easiest to do so with the release of new products.
Of course, Cook didn’t let the possibility of increased prices slip accidentally. If the threat of higher prices increases demand for Apple products now, that could still boost Apple’s bottom line. That’s what happened in 2025 when threatened tariffs caused people to move up planned purchases to an extent that outweighed the cost of the actual tariffs (see “Apple Reports Record-Breaking Q3 2025 Results,” 1 August 2025).
In other words, don’t look for Apple to be starting a GoFundMe anytime soon.
