Apple to raise device prices as AI drives memory chip shortage

Apple has begun raising prices on its devices and warned of more to come, as a global shortage of memory chips driven by artificial intelligence demand squeezes the technology industry.

Chief executive Tim Cook said price increases were "unavoidable," describing the supply crunch as a crisis unlike anything he had seen in more than four decades in the industry and comparing it to a "hundred-year flood." The shortage stems from soaring demand for memory and storage chips from AI data centres.

Those data centres are expected to consume roughly 70 percent of the world's memory chip output in 2026, forcing consumer electronics makers into intense competition for dwindling supplies and pushing component prices sharply higher.

The effect is already visible on Apple's price list. A MacBook Pro that cost $1,699 rose to $1,999, a $300 increase, while a lower-cost model climbed from $599 to $699. Other products are expected to follow as the shortage persists.

Cook suggested Apple could draw on its substantial cash reserves to help expand memory production, saying the company was willing to use its balance sheet to be "part of the solution." The squeeze highlights how the AI boom is reshaping costs across the wider consumer technology market.