Rising Memory Costs Threaten Apple
Apple is about to feel the squeeze from rising memory prices, with the cost of RAM climbing just as the company heads into its busiest shopping season. According to Reuters, Apple expects to pay more for memory in the December quarter, with executive John Ternus describing the current price increases as unprecedented. The company has so far managed to soften the blow by using memory bought at lower prices, cutting costs elsewhere and raising prices on some products. However, its manufacturing bill has climbed significantly in just a few months.
But that cushion is getting thinner, and Apple expects memory purchases to become even more expensive into 2027. Ternus noted during an earnings call that higher memory costs seen in the September quarter were partly offset by carrying inventory and lower costs on certain non-memory components. Price increases implemented on Mac, iPad, and iPhone models have also provided some financial offset.
Supply Pressures and Market Outlook
Memory is used across Apple's hardware lineup, so sustained price increases could affect manufacturing costs for several product categories. Analysts point out that Apple is in a different position from companies pouring hundreds of billions of dollars into AI data center infrastructure, as the impact of higher component costs is easier to quantify than eventual returns on massive AI capital expenditure.
The next pressure point for @Apple may not be AI CapEx, but the rising cost of memory across its hardware portfolio. @TheFuturumGroup Chief Research Officer @DaveN007 explained that higher memory prices could put more pressure on Apple’s margins and pricing through the holiday season and into 2027. Even with demand holding up, the question is how much of those higher costs consumers will absorb. Dave also sees Apple in a stronger position than companies committing hundreds of billions to data center infrastructure, because the impact of higher component costs is easier to quantify than the long-term returns on massive AI CapEx. ▶️ Watch Dave’s analysis of Apple’s margin outlook, memory costs, and why its AI infrastructure strategy could give the company more flexibility. #Apple #AI #Semiconductors #FuturumNovember 3, 2026
Supplier Warnings and Industry Constraints
Warnings from major suppliers suggest that cost pressure is unlikely to ease quickly. Samsung reported that memory demand would far exceed supply as AI infrastructure continues to expand, with DRAM average prices rising alongside high-teen percentage increases for NAND. Executives warned the supply crunch could extend to 2028 and beyond. SK Hynix and Micron delivered similar warnings, noting that supply shortages in memory and storage could take considerable time to improve.
Previous quarters already highlighted these pressures, with rising component expenses translating into higher retail prices across several Mac and iPad models. Executive leadership previously described the memory market as a major hurdle, prompting the company to increase inventory to build a buffer against supply and price pressures.
