Your Next iPhone Could Cost Hundreds More and Tim Cook Says There's No Avoiding It

A Warning From the Outgoing CEO

Days after his final WWDC, Tim Cook is spending his last months as Apple CEO delivering an unusually blunt warning to customers: prices are going up, and there's no stopping it. In a candid interview with the Wall Street Journal, Cook told the publication, "Unfortunately, price increases are unavoidable. 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 called the memory chip crunch a "hundred-year flood" that has pushed Apple past its breaking point, saying he's "never seen anything like it in any area in over 40 years." The company had been absorbing higher component costs throughout 2026, but the CEO said that strategy has now collapsed. It's a remarkable admission from a leader who has long prided himself on shielding Apple customers from the turbulence of global supply chains.

AI Is the Culprit — Not Tariffs

The root cause is a structural shift in the chip industry. Samsung, SK Hynix, and Micron — three companies that together control around 95% of global DRAM production — have redirected their most advanced memory to AI data centers, where margins are far higher. That leaves consumer devices competing for a shrinking supply of standard chips.

At the root of the problem is fierce rivalry for memory and storage components fueled by the AI buildout. After hyperscalers like Google, Microsoft, Meta, and Amazon began dramatically expanding their capital expenditure budgets, the cost of both chip types shot up fourfold. Global smartphone memory costs surged roughly 90–95% in the first quarter of 2026 alone, per IDC data, and the average selling price of a smartphone worldwide has already risen 14% year-on-year to a record $523. Cook was also explicit that tariffs are not the driver here — this is a chip supply problem, plain and simple.

What It Means for Your Next Upgrade

Cook declined to provide details on the timing or scale of the planned price increases, nor which products would be affected. However, the Wall Street Journal estimated the price of the upcoming iPhone 18 Pro to be $1,299 — which would be $200 more compared to the iPhone 17 Pro. The comments come ahead of Apple's expected September product launch cycle, which is widely anticipated to include its first foldable iPhone alongside the iPhone 18 Pro and Pro Max.

Apple has already discontinued certain Mac models to manage expenses, while other tech giants like Microsoft and Sony have similarly raised prices. Hewlett-Packard, Dell, and Nintendo are among the device makers that have already moved to raise prices, and several trade associations have jointly petitioned Treasury Secretary Scott Bessent and Commerce Secretary Howard Lutnick, urging federal intervention to address the diversion of memory supply toward AI customers.

A Changing of the Guard at a Critical Moment

Hardware engineering chief John Ternus takes over as Apple's top executive on September 1, capping a 15-year tenure for Cook at the helm of the company. That means the full weight of navigating these price increases — and the customer backlash that may follow — will land squarely on his successor's desk. Cook indicated Apple may use its financial muscle to help ease the crunch but ruled out manufacturing memory chips in-house, saying, "We're willing to use our balance sheet to help be a part of the solution," while clarifying Apple has no plans to build its own memory and storage factories.

The shortage is not expected to ease before 2027, according to multiple industry analysts. For consumers, that means the era of relatively stable iPhone pricing — already tested in recent years — may be firmly over. How much loyalty Apple's customer base extends when sticker prices climb well past $1,300 will be one of the defining questions of the post-Cook era.