Apple has announced major price increases for several MacBook and iPad models, sending its stock sharply lower and sparking concerns among investors. The move comes after CEO Tim Cook warned that rising memory and storage chip costs, fueled by the rapid growth of artificial intelligence (AI), were becoming impossible for the
company to absorb.
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Apple Stock Takes a Hit
Apple shares fell 5.3% to around $277 on Thursday afternoon after the company confirmed the price hikes. Earlier in the day, the stock had dropped as much as 6%.
The decline wiped out roughly $275 billion from Apple’s market value, bringing its total valuation to just over $4 trillion. As a result, Apple slipped behind Alphabet, which now holds a market capitalization of about $4.1 trillion, making Apple the world’s third-largest company by market value. Nvidia remains in the top spot at approximately $4.7 trillion.
MacBook Prices Jump Sharply
Among Apple’s products, the MacBook Pro 1T saw the biggest price increase.
The entry-level MacBook Pro 1T now starts at $1,999, up from $1,699.
Meanwhile, the MacBook Neo, Apple’s most affordable laptop, has increased in price from $599 to $699. The base MacBook Air 512GB model has also become more expensive, rising from $1,099 to $1,299.
iPads Also Get More Expensive
Apple’s iPad lineup has not been spared from the price hikes.
The iPad Air 128GB now starts at $749, compared to its previous price of $599. The iPad Pro WiFi 256GB has also become significantly more expensive, increasing from $999 to $1,199.
Tim Cook Warned About Rising Costs
Earlier this month, Tim Cook cautioned that soaring memory and storage chip prices would eventually be passed on to customers.
On Thursday, Apple described the current situation as unprecedented, saying it had never experienced component costs rising so dramatically in such a short period of time.
Speaking to The Wall Street Journal earlier this month, Cook said, “This is a hundred-year flood. I’ve never seen anything like it in any area in over 40 years.”
What Happens to the iPhone Next?
Attention is now turning to Apple’s upcoming iPhone lineup.
The company is expected to unveil the iPhone 18 Pro, iPhone 18 Pro Max, and the widely rumored foldable iPhone Fold/Ultra in September.
According to Tarun Pathak, Research Director at Counterpoint Research, the rising cost of chips could push iPhone prices up by around $150 to $200 per device.
Apple also suggested that further increases may be on the way, stating that the ongoing chip crisis has reached a stage where it needs to start raising prices across a number of products.
Other Tech Giants Are Raising Prices Too
Apple is not alone in passing higher costs on to customers.
Nintendo has already announced that its flagship gaming console will become $50 more expensive starting in September. Sony and Microsoft have also recently increased prices for their PlayStation and Xbox consoles.
In the PC market, Lenovo has raised prices for its computers and servers, while Dell and HP have also increased laptop pricing amid rising component costs.