“The rate of increase in memory prices is unprecedented,” Mike Howard, an analyst at TechInsights, told The Wall Street Journal. By the end of the year, DRAM prices are expected to quadruple compared with 2023 levels, while NAND flash prices could more than triple.

For Apple, this has direct consequences. The base iPhone 18, expected this fall, could incur $57 more in memory costs than the current iPhone 17. At a retail price of $799, that represents a significant hit to profit margins.

The main driver is surging demand from AI companies such as OpenAI, Google, and Meta, which are paying premium prices and increasingly outcompeting Apple for scarce components. At the same time, Nvidia has overtaken Apple as TSMC’s largest customer, a position Apple had held for years.