AI boom drives chip crunch as Apple signals broad price hikes across devices
In comments to the Wall Street Journal, Cook described the current memory market as “unsustainable,” pointing to a sharp imbalance between supply and demand intensified by the rapid expansion of artificial intelligence infrastructure. He said price adjustments are now “unavoidable,” though Apple has not disclosed when increases will take effect or which product lines will be affected.
The potential impact on upcoming devices, including the expected iPhone 18 launch later this year, remains uncertain. At the centre of the pressure is a surge in demand for memory chips—critical components in smartphones, laptops, and data centres. Prices for RAM have reportedly more than doubled since late 2025, as AI companies compete aggressively for limited semiconductor capacity, squeezing availability for consumer electronics manufacturers.
Cook said Apple has attempted to shield customers from rising input costs, but warned that persistent supply shortages are forcing a reassessment of pricing across the industry. Analysts now expect global smartphone prices to rise by as much as 20% in 2026, with flagship devices potentially increasing by up to $150. The pricing pressure is also reshaping geopolitical and industrial strategy. US President Donald Trump announced that Apple will collaborate with Intel to expand chip manufacturing in the United States, part of a broader effort to strengthen domestic semiconductor production. The announcement sent Intel’s shares higher in early trading.
Across the semiconductor landscape, the strain is being felt broadly. Major suppliers such as TSMC and Samsung have also flagged rising production costs and the likelihood of further price adjustments, underscoring a structural shift in the industry as AI demand continues to outpace supply capacity.
What was once a relatively stable component market has now become one of the most volatile fault lines in the global tech economy—one increasingly defined by artificial intelligence, constrained supply chains, and rising end-user costs.