(Credit: Eric Zeman/PCMag)
Rising memory costs will not affect the prices of iPhone 18 models launching later this year, according to analyst Ming-Chi Kuo. Apple is expected to absorb the cost difference and make up for it later through its services, Kuo adds.
For the past several months, memory manufacturers have focused on meeting demand from AI data centers. This has reduced the supply of memory for smartphones and PCs, pushing their prices higher.
Last month, analyst firm IDC forecast that the ongoing issue could raise smartphone prices by up to 6-8% this year. Samsung’s co-CEO TM Roh also hinted at price hikes for the company’s products. Apple, however, will try to avoid the hike as much as possible, Kuo says.
According to the analyst, Apple plans to use the situation to its advantage. Keeping iPhone prices steady will impact its gross margins, and the company is willing to accept that in exchange for increased market share.
Additionally, Kuo notes that Apple receives a steady supply of memory, unlike other non-AI brands, and negotiates prices with its suppliers on a quarterly basis rather than every six months.
Even if costs rise in the next quarter, the company will try to keep the starting prices of the iPhone 18 series the same as those of the iPhone 17 lineup for marketing advantages, Kuo says. He adds that the lost dollars could be recovered through higher subscription prices for services such as Apple Music, Apple TV, and iCloud+.
As usual, Apple is expected to unveil its new iPhone lineup in the fall. Multiple reports have indicated that the company will announce just three models at this year’s event: the iPhone 18 Pro, the iPhone 18 Pro Max, and the first-ever foldable iPhone. If Kuo’s analysis holds, the iPhone 18 Pro will start at $1,099, and the 18 Pro Max will start at $1,199.