Apple CEO Tim Cook Announces Price Hikes Due to Soaring Chip Costs

Apple plans to raise prices on its products to offset increasing memory and storage chip costs, CEO Tim Cook told the Wall Street Journal in an interview.

A surge in AI-driven demand for data centers has forced consumer electronics companies into a fierce competition for dwindling supplies of the key components, driving prices sharply higher.

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Groups representing automakers, retailers, electronics ‌firms and others had ⁠warned ⁠earlier this month that the increasing demand for memory chips could lead to dramatic price hikes in U.S. consumer goods and disrupt supply chains.

"Unfortunately, price increases are unavoidable," Cook 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."

Cook, who will hand over the reins to John Ternus ⁠in September, did ‌not disclose when or how much prices might rise, nor which products could be impacted.

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Apple is reportedly on track to release its first ⁠foldable iPhone in September, alongside the iPhone 18 Pro and Pro Max.

Memory and storage costs are both concerns for the company, with particular emphasis on the DRAM market, Cook told the Journal. He noted that more supply is being allocated to high-bandwidth memory, which is used in AI servers.

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"There's less supply at a time when consumers want devices and the memory guys are passing along huge price increases," he said. "We definitely need memory pricing and supply ‌to return to reasonable levels for consumer products. That's the bottom line."

China has leading domestic memory and storage companies, but U.S. firms would likely need licenses to work with them under national-security ⁠rules. Asked if restrictions should be eased, Cook said: "Everything needs to be on the table," adding, "I think we should look at all supply."

In the interview, Cook indicated that Apple is prepared to use its cash reserves to boost memory supply, without offering details. "We're willing to use our balance sheet to help be a part of the solution," he said. "Obviously, more capacity is needed." Cook clarified that Apple has no plans to use its cash and silicon expertise to build its own memory and storage factories.