Apple raises Mac and iPad prices up to $300 as memory costs quadruple

Apple raised Mac and iPad prices by 15% to 25% on Thursday, the first consumer electronics maker to formally pass on memory chip costs that have quadrupled in 12 months as AI data center demand consumes global supply.

"We have never seen a component price increase this much, this quickly," Apple said in a statement. Chief Executive Officer Tim Cook told the Wall Street Journal last week that the situation was "a hundred-year flood" and that price increases had become "unavoidable."

The base MacBook Air rose $200 to $1,299, the MacBook Pro jumped $300 to $1,999, and the entry-level MacBook Neo increased $100 to $699. iPad Air climbed $150 to $749, while the iPad Pro added $200 to $1,199. iPhone prices were unchanged. The increases follow a surge in DRAM and NAND flash prices, which have both quadrupled over the past year, according to research firm TechInsights, with TrendForce projecting another 58% to 63% jump in the current quarter.

The move confirms the AI capex cycle thesis for memory makers while driving broad consumer electronics inflation. Micron Technology, the largest US memory manufacturer, reported quarterly gross margins above 80% on Wednesday, with shares jumping 16% after-hours. Chief Business Officer Sumit Sadana said "tight conditions" will persist beyond 2027, as AI hyperscalers lock in long-term supply deals — Micron has secured $22 billion in such commitments.

The price hikes mark a turning point for Apple, which had used its purchasing scale to shield customers from component inflation through the first half of the year. Cook warned analysts in April that rising memory costs would begin to catch up by the end of June, with profitability expected to decline slightly. Apple's online store briefly went down Thursday morning before reappearing with the updated prices, a move the company typically reserves for new product launches.

Memory suppliers have redirected production toward high-bandwidth memory used in AI servers, leaving less supply for consumer devices. Counterpoint Research estimates memory and storage prices have quadrupled in the past three quarters. The shift has been a windfall for Micron, whose revenue quadrupled year-over-year while gross margins surged from 39% a year ago to 84.9% in the most recent quarter, surpassing both Nvidia and Meta.

For Apple, the increases create competitive pressure. The MacBook Neo's $100 price hike erases its price advantage over Dell's XPS 13, which launched at $699 specifically to compete with Apple's entry-level laptop. IDC projects the smartphone market will see its biggest-ever annual decline of nearly 14% this year, while PC sales are expected to fall 11.3%, as higher device costs weigh on consumer demand.

The memory crunch also gives Apple a strategic rationale to emphasize higher-memory configurations. IDC expects all new iPhone models to move to 12GB of RAM as Apple Intelligence features require more on-device memory. Roughly 54% of iPhones shipped since 2022 will not support the full new Siri experience, creating a potential upgrade cycle that could help offset higher component costs. IDC sees Apple's average selling price rising 12% this year, helped by a richer product mix and the expected launch of a foldable iPhone.

Tarun Pathak, research director at Counterpoint Research, estimates the higher cost of components could add roughly $200 per iPhone for Apple, with price increases of about $150 to $200 across the lineup weighted toward higher-memory configurations. Apple shares were little changed in regular trading Thursday.

This article is for informational purposes only and does not constitute investment advice.