Apple confirmed yesterday that price increases were coming to its lineup due to rising memory chip costs, and now The Wall Street Journal released its own analysis estimating that the iPhone 18 Pro could start as high as $1,399.
Talk with The Wall Street Journal Yesterday, Apple CEO Tim Cook acknowledged that the company is not immune to soaring memory chip costs. When asked which devices would see their prices increase and when, Cook said, “We’re still working on it,” with further clarification expected to come with the next iPhone lineup in September.
The price increases stem from a global shortage of DRAM and NAND flash storage, driven largely by competition from AI data centers for the same components. Manufacturers such as Samsung Electronics and Micron Technology have shifted production toward enterprise-wide memory chips for AI servers, reducing the supply of consumer electronics devices like the iPhone.
Citing analysis from research firm TechInsights, The Wall Street Journal now reports that prices for DRAM and flash storage are expected to roughly quadruple by this fall compared to last year. TechInsights estimates that Apple paid around $39 for the iPhone 17 Pro’s 12GB of DRAM, a cost that could climb to $145 in the iPhone 18 Pro. The 256GB flash storage tier, which costs Apple around $13 on the iPhone 17 Pro, could rise to $51.
Overall, TechInsights estimates Apple’s component and manufacturing costs for the iPhone 17 Pro, excluding memory, at around $530. Combined with DRAM and flash storage, this puts the total estimated BOM of the base iPhone 17 Pro at around $582, with costs for the iPhone 18 Pro expected to increase by 25% to around $726.
TechInsights research suggests the $1,099 iPhone 17 Pro generates a gross margin of around 47%. To preserve this margin on the iPhone 18 Pro, Apple would have to charge $1,371, but The Wall Street Journal notes that Apple’s preference for standardized pricing makes a starting price of $1,299 more likely, a margin of 44%.
That estimate doesn’t take into account a new camera system, which supply chain analyst Ming-Chi Kuo estimates could cost Apple about 50% more than the previous generation. Account for this additional cost using the same approach, The Wall Street Journal estimates that Apple could set the starting price of the iPhone 18 Pro at $1,399 or higher.
A starting price in this range would represent a jump of $200 to $300 from the $1,099 iPhone 17 Pro. The iPhone 18 Pro Max would likely start $100 more than the price Apple set for the Pro, which is the current gap between the two models. The iPhone 18 Pro models are expected to launch alongside the foldable ‘iPhone Ultra’, which would have a starting price of around $2,000.
