iPhones Are About to Get Expensive, Apple's Tim Cook Says 'It's Unavoidable'

The iPhone in your pocket may soon be the cheapest one you ever own. Apple CEO Tim Cook has reportedly confirmed that price increases across the company's product lineup are coming, and he's blaming a global memory chip crisis fuelled by the AI boom, one he's calling a once-in-a-generation event.

'The situation has become unsustainable,' says Tim Cook

In a rare and candid interview with The Wall Street Journal, Cook acknowledged that Apple has hit a wall. "Unfortunately, price increases are unavoidable," he told WSJ. "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."

The stark admission marks a significant shift for a company that has historically absorbed supplier cost increases rather than pass them on to consumers. Apple raised the starting price of the Mac Mini last month in between launch events, a quiet signal that something larger was coming. Now, Cook has made it official.

Cook likened the memory shortages to a hundred-year flood. "I've never seen anything like it in any area in over 40 years," he said.

Chip supply crunch is the main cause

The root cause is a supply crunch that has little to do with Apple and everything to do with the AI arms race. A surge in AI-driven demand for data centres has forced consumer electronics companies into fierce competition for dwindling supplies of memory and storage chips, driving prices sharply higher.

Hyperscalers like Meta and Amazon have already announced billions in AI capital expenditure for 2026 alone, building out massive data centres needed to power AI agents, and they're snapping up memory chips at a pace that has left consumer electronics manufacturers scrambling.

A graph of price changes in DRAM and NAND pricing since 2023 by TechInsights estimates both will have increased by over 300 percent by the third quarter of 2026. The situation has been bad enough that Micron has discontinued production of consumer memory products to focus on supplying commercial customers, while products from PlayStation 5 consoles to Samsung LPDDR5X DRAM have seen 100 percent price increases or greater.

"There's less supply at a time when consumers want devices and the memory guys are passing along huge price increases," Cook told.

How much more will you pay for an iPhone 18?

Cook declined to specify timing, quantum, or which products would be affected. But analysts have done the math. Research firm TechInsights claims Apple will need to make the iPhone 18 Pro around $270 more expensive to keep its existing profit margin.

That calculation doesn't even account for a potential new camera system that will also cost Apple about 50 percent more than previous models, according to supply chain analyst Ming-Chi Kuo. Following that math, Apple could set the starting price of the iPhone 18 Pro at $1,399 or higher.

Given that Apple's top-of-the-line 2TB iPhone 17 Pro Max is currently priced at $1,999, one can imagine the upcoming iPhone 18 Pro Max or iPhone Ultra folding phone topping the $2,000 mark.

Compounding the issue is Apple's need for additional DRAM to support new AI features, including a rebooted Siri announced last week.

What does Apple plan to do?

With no quick fix on the supply side, Cook signalled that Apple is prepared to deploy its formidable cash reserves. "We're willing to use our balance sheet to help be a part of the solution," he said. "Obviously, more capacity is needed." He did not offer specifics on what that means in practice.

On whether Apple might build its own memory factories, a path some chip companies have taken, Cook shut the door. "We can't do everything," Cook said.

The question of where Apple sources its memory has also become politically loaded. China has leading domestic memory and storage companies, but US firms would likely need licences to work with them under national-security rules. Asked if those restrictions should be eased, Cook said, "Everything needs to be on the table. I think we should look at all supply."

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.