Apple CEO Tim Cook gestures as Apple hosts an event at the Steve Jobs Theater on its campus in Cupertino, California, United States, September 9, 2025.
Manuel Orbegozo | Reuters
The global memory crisis has played an outsized role in the tech earnings season, which reached its peak this week. Apple CEO Tim Cook warned that this is only the beginning.
“We believe memory costs will have an increasing impact on our business,” Cook said in his company’s Q&A. call for results Thursday after repeatedly telling analysts that the company faced “supply constraints” in the most recent quarter. “We will continue to evaluate that.”
Apple’s earnings report, which included a near flat result and better-than-expected revenue forecasts, came a day later Meta And Microsoft stated in their results that higher memory prices contributed to their high forecasts for capital spending for the year.
In projecting $190 billion in investments for 2026, up 61% from last year, Microsoft Chief Financial Officer Amy Hood said in a conference call that she expects a $25 billion impact from rising component prices. Meta noted that “expectations of higher component prices” contributed to the increase in its investment forecast from a maximum of $135 billion to $145 billion.
Across the tech landscape, executives have expressed concerns over soaring memory prices, which are facing a global crisis due to insatiable demand for artificial intelligence infrastructure. Each generation of Nvidia The chip, the processor at the heart of the AI boom, contains more memory, further constricting an already stressed market.
Memory maker Micronwhose stock has risen about 570% over the past year, is working to increase its capacity, as are its competitors. Samsung And SK Hynix. While AI chips and data centers consume a considerable amount of resources, memory for consumer devices like PCs and smartphones is increasingly scarce, and therefore much more expensive.
That’s why it was such an important topic during Apple’s call.
Cook said Apple’s revenue growth of 17% for the fiscal second quarter exceeded his forecasts “despite supply constraints.”
It said the impact in the December quarter was “minimal” and it was hit slightly more in the March period. For the quarter ending in June, Cook said the major impact would be felt across multiple Mac models “given the continued high demand levels we’re seeing.”
Analysts wanted to know what Apple would do in response, but they didn’t get many details. Cook has repeatedly said: “We will look at a range of options.”
Since January when AI memory began saleWall Street has asked consumer electronics companies like Apple and Dell how they will deal with the memory shortage and whether they might be forced to increase prices or reduce margins.
“Apple has shown that even the best operators can’t completely escape memory shortages,” said Jake Behan, head of capital markets at Direxion. “Tim Cook’s warning of “significantly higher” costs in the coming quarters shows you how real the AI-driven supply crisis has become for the entire industry.”
Apple has so far largely avoided price increases. In March, the company announcement a number of new products, including its iPhone 17e, a refreshed iPad Air laptop with an M4 chip in 11- and 13-inch sizes. He also unveiled the MacBook Neo, a low-cost laptop that Cook admitted had even higher demand than expected.
The enigma of memory will soon fall into the lap of new CEO John TernusApple’s longtime hardware boss, who will succeed Cook in the top job in September.
Eat the costs?William Kerwin, an analyst at Morningstar, told CNBC in an email that one option for Apple would be to enter into longer-term supply agreements in order to obtain more favorable prices. He noted that the memory creator Sandisk discussed “many new deals like this” during its earnings conference call Thursday.
Laura Martin, an analyst at Needham, said that while she didn’t know what Cook was referring to in suggesting the company would consider options, it wasn’t great to see capacity constraints “for a company with a core competency in hardware.”
Wall Street took the news in stride, reacting positively to Apple’s forecast for 14% to 17% revenue growth for this quarter, and sending the stock higher. Analysts expected growth of 9.5% to $103 billion, according to LSEG.
Gil Luria, an analyst at DA Davidson, told CNBC that Apple had managed to avoid raising iPhone prices, but that “agreements with memory suppliers may have to change.” He said some options for Apple would be to reduce the memory available in products, increase the price of handsets, or reduce some of the additional costs and absorb lower gross margins.
Nabila Popal, an analyst at IDC, said the range of options could be linked to an increase in iPhone prices, but they would not necessarily be distributed evenly across all models.
“I think they will focus the price increases on the Pro/Max while keeping the same base model next spring,” she said via email.
Some analysts say the memory shortage presents an opportunity for Apple to gain market share this year, while other manufacturers face even greater challenges.
Morningstar’s Kerwin said of the latest results that he was “impressed by Apple’s profitability amid immense memory price inflation.”
Direxion’s Behan echoed the sentiment that Apple is better positioned than anyone.
“Apple’s size, balance sheet strength and relatively conservative approach to investing will likely give it more flexibility than most to address these constraints over time,” he said.
WATCH: Apple attributes iPhone failure to supply chain constraints.
