Apple has reportedly taken its online store offline ahead of what is usually a product launch, but this time the move coincided with price increases across iPads and MacBooks—some rising by as much as ₹1 lakh. The trigger, according to reports, is a sharp surge in memory chip prices driven by booming demand from AI companies.
Memory is a core component in all modern electronics, from smartphones and laptops to AI data centre servers. With major AI players like Google, OpenAI, and Anthropic aggressively securing large volumes of supply, availability for consumer device makers has tightened, pushing prices upward.
This imbalance between demand and supply has created what Apple CEO Tim Cook described as a “hundred-year flood” in component pricing. He said he had never seen such a rapid and severe spike in costs over his four decades in the industry, adding that rising memory prices were being passed directly onto device manufacturers.
To manage the situation, Apple has acknowledged that it has reached a point where it must increase prices on several products. The company argues that supply constraints and escalating costs have left it with little flexibility, especially as consumer demand for devices remains strong.
Industry dynamics are also shifting as memory suppliers prioritise AI-related demand. Companies such as Micron have even scaled back or shut down consumer-focused divisions to focus on more profitable AI contracts. This has reduced production capacity for traditional RAM and NAND chips, further tightening supply for consumer electronics.
Micron executives have pointed to earlier industry downturns where aggressive pricing from customers affected investment decisions, contributing to today’s supply constraints. Meanwhile, the global memory market remains dominated by Samsung, SK Hynix, and Micron, all of which are now heavily influenced by AI-driven demand patterns.
Apple has indicated that it is exploring all possible options, including diversifying its supply chain, though shifting to alternative suppliers—such as Chinese manufacturers—would likely require regulatory approval in the US.
The impact of rising memory costs is not limited to Apple. Microsoft has also increased Xbox prices, while smartphone brands like Realme, OnePlus, and Vivo have adjusted pricing. Some companies, such as Nothing, have reportedly even scrapped product plans due to unviable economics under the new cost structure.
Overall, the trend reflects a broader shift in the tech industry where AI infrastructure demand is reshaping global supply chains, leaving consumer electronics makers to absorb higher costs or pass them on to buyers.
