Tim Cook warns rising memory costs may force Apple to raise iPhone prices

Tim Cook Apple fans may need to brace for higher price tags on future iPhones. During the Apple Q2 2026 earnings call, CEO Tim Cook warned that the rising cost of computer memory is becoming a significant burden on the company's bottom line, sparking speculation that these costs may soon be passed on to consumers. Cook provided a detailed timeline of how these expenses are hitting the tech giant. He emphasised that the impact was "minimal" late last year but memory costs began to climb in the March quarter but the company absorbed it. However, the real pressure is just beginning. "I will go back to December for a moment and walk you through the chronology. In the December quarter, we really had a minimal impact due to memory, and you can see that in the gross margin results. We said it would be a bit more in the March quarter, and we did see higher memory costs in the March quarter, and they were partially offset by benefits from carry-in inventory that we had," Cook said while responding to a question during the earnings call. A growing financial burden. According to Cook, Apple expects "significantly higher memory costs" for the current June quarter. While the company has managed to soften the blow using older inventory it already had in stock, that buffer is running out. "For the June quarter—and what is embedded in the guidance that Kevan went through earlier—we expect significantly higher memory costs," he added. "They are also partly offset by the benefit of carry-in inventory. And while we do not give color beyond June, I can tell you that beyond the June quarter, we believe memory costs will drive an increasing impact on our business, and we will continue to evaluate this. As we have said before, we will look at a range of options," he said on the call. When asked how Apple would handle these rising expenses, he noted the company is evaluating a "range of options," a phrase often used by executives when price increases are on the table. Supply chain struggles for Apple are for SoCs not memory. While memory costs are a long-term financial worry, Apple is battling immediate supply shortages that are making it hard for customers to find certain products. The primary struggle right now isn't memory, but the availability of advanced "System on a Chip" (SoC) processors. Supply and demand for the Mac mini and Mac Studio are not expected to balance out for "several months". "The constraint in March and June—the primary constraint—is the availability of the advanced nodes our SoCs are produced on, not memory. I do not want to predict our ability for supply and demand to match. Realistically, on the Mac mini and the Mac Studio, I believe it will take several months to reach supply-demand balance," Cook said. "We are not at the point where we are saying this is going to end anytime soon. It is not because of a problem per se, other than we undercalled demand, and there are lead times as you know. For this quarter—the June quarter—the majority of the constraint will be on Mac: Mac mini, Mac Studio, and MacBook Neo. It is all of those," he added.