📌 Rising Memory Prices Are Squeezing Apple’s Gross Margin
The sharp rise in memory prices is shifting from a supply problem in the chip industry chain into a margin risk for end-hardware companies such as Apple. The core issue is not whether demand remains resilient, but whether higher component costs can be absorbed through product prices, product mix, or supply-chain bargaining.
Intel CEO Lip-Bu Tan said memory prices have risen by 5 to 7 times. In some low-end smartphones and laptops, memory costs account for about 75%. SK hynix believes 2027 could become one of the years with the tightest supply. If this supply-demand assessment materializes, end-device manufacturers will face not a one-off procurement fluctuation, but persistently higher material costs.
For Apple, the pressure can already be measured in gross margin. One analysis estimates that higher memory prices could put pressure of more than 2.8 percentage points on Apple’s incremental gross margin in QSep, adding more than USD 3.2 billion in costs versus QMar. The iPhone’s current performance and share advantage relative to Android may not automatically offset these costs; revenue growth does not mean that every unit of additional revenue can retain the original profit.
However, the above price increases, the 2027 supply outlook, and Apple’s cost sensitivity all come from secondary accounts and analytical estimates, and still need to be verified against Apple’s financial reports, management guidance, and memory contract prices. What is more worth watching next is how long memory prices remain elevated, and whether Apple can limit the transmission of costs to the income statement through procurement and product strategies.
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