Apple has raised prices across its iPhone lineup as an industry-wide memory shortage driven by the artificial intelligence boom pushes up the cost of components used in consumer electronics.

The company on Tuesday unveiled the iPhone 18 Pro and iPhone 18 Pro Max at prices $100 higher than their predecessor models, while introducing its new foldable iPhone Duo at $1,999. Apple has yet to announce the entry-level iPhone 18.

The price increases extend beyond Apple’s newest premium devices. The company also raised the prices of older iPhones still sold through its online store, going back to the iPhone 16, the oldest generation currently available new from Apple.

The iPhone Air, launched nearly a year ago at $999, now costs $1,099. The iPhone 17e and iPhone 17 have also increased by $100 to $699 and $899, respectively.

Apple’s iPhone 16 now sells for $799, effectively restoring its original launch price when it debuted in September 2024.

The changes mark a broader shift in Apple’s pricing strategy as the company confronts sharply higher memory costs. Rather than limiting the impact to its newest flagship models, Apple has passed some of the higher component costs across much of its current smartphone range.

The iPhone 18 Pro and Pro Max will be offered with 256GB, 512GB, 1TB and 2TB storage options.

At the top of the range, the 2TB iPhone 18 Pro will cost $2,399, while the 2TB iPhone 18 Pro Max will sell for $2,499. Both prices are higher than the previous most expensive iPhone, the 2TB iPhone 17 Pro Max.

The foldable iPhone Duo takes Apple’s pricing even further. Its 2TB version will cost $3,199, making it by far the company’s most expensive iPhone.

The pricing gives Apple considerable room to segment its premium lineup, with customers paying large premiums for additional storage and new form factors. It also illustrates the unusual cost pressures now affecting the smartphone industry. Apple has enormous purchasing power and a scale that allows it to negotiate aggressively with suppliers, yet the company is still being forced to contend with a component market increasingly shaped by demand from AI data centers.

AI Boom Creates A Memory Squeeze

The immediate pressure comes from the global memory market, where chipmakers are directing more production toward components used in AI infrastructure.

AI data centers require vast quantities of high-performance memory and other specialized chips. As manufacturers prioritize those higher-value products, supplies available for conventional consumer electronics can become tighter and more expensive. That dynamic has created an unusual link between the cost of running AI models in massive data centers and the price consumers pay for smartphones, tablets and computers.

Apple’s former CEO Tim Cook highlighted the scale of the problem during his final earnings call as chief executive, saying the company had “reluctantly raised prices” on iPads and MacBooks because of higher memory costs.

“We did it because we’re in what I would characterize as a 100-year flood on the memory pricing with exponential increases in memory prices,” Cook said.

Apple had already raised iPad prices by as much as 25% in June and Mac prices by up to 20%. At the time, existing iPhone models were largely spared from the increases.

The latest iPhone pricing changes suggest that the pressure has now reached Apple’s most important product category.

Others Too

The higher prices are part of a wider trend among consumer electronics manufacturers. Samsung and Google have also indicated that higher memory costs contributed to price increases on some smartphone models.

Google ultimately increased the price of its baseline Pixel 11 by $100. The company softened the increase by doubling the entry model’s storage capacity while eliminating the previous 128GB version.

Shakil Barkat, Google’s vice president of devices and services, described the market in unusually stark terms in July.

“There’s never been an increase in memory prices like the world’s going through right now,” Barkat said ahead of the Pixel 11 launch.

The comparison is important because Apple, Samsung and Google have different supply chains and product strategies, yet all are being exposed to the same underlying shift in semiconductor demand.

The smartphone industry is therefore facing a cost problem originating outside smartphones themselves. The extraordinary investment required to build AI computing capacity is competing for semiconductor manufacturing resources with the devices used by consumers.

Apple has historically had greater pricing power than most smartphone manufacturers, particularly at the premium end of the market. Its customer base has shown a willingness to pay more for higher-end models, additional storage, and new designs.

That gives Apple some protection against component inflation, but it does not eliminate the underlying risk. Passing higher costs to customers can preserve margins, but it can also make upgrading less attractive, particularly in markets where consumers are already facing pressure on household budgets.

Apple’s decision to raise prices on older models is especially notable. Those devices typically serve as lower-cost alternatives for customers who want an iPhone without paying flagship prices. Increasing their prices narrows the gap between Apple’s older and newer generations and could push some consumers toward buying newer models, accepting higher prices or delaying an upgrade altogether.

At the same time, Apple’s expansion into more expensive products such as the iPhone Duo gives the company additional opportunities to capture revenue from customers willing to pay for premium hardware.

The smartphone price increases highlight a less visible consequence of the AI investment boom.

The enormous spending by technology companies on data centers, AI accelerators and supporting infrastructure is increasing demand for specialized semiconductors and memory. That demand can alter manufacturing priorities throughout the chip industry, affecting the availability and cost of components used in everyday electronics.

For consumers, the result is increasingly visible at the checkout counter. Apple’s latest pricing decisions are seen as an indication that the AI boom is no longer only a story about data-center spending and technology companies racing to build computing capacity. It is beginning to influence the economics of the hardware carried by billions of consumers.

The iPhone 18 Pro and Pro Max will be available for preorder on September 12 and will go on sale September 18.

Apple unveiled its first foldable iPhone at its flagship fall product event on Wednesday, putting new Chief Executive John Ternus on stage for the company’s biggest hardware launch in years and marking the first leadership change at the keynote since Tim Cook became CEO 15 years ago.

Taking a page from Steve Jobs’ presentation playbook, Ternus saved “one more thing” for the end of the event before introducing the iPhone Duo, a foldable device that opens from a passport-like form factor into a larger, iPad-style display.

The launch gives Ternus, a longtime Apple hardware executive who previously led the company’s hardware organization, an early opportunity to establish his leadership with consumers and investors. It also places him at the center of Apple’s effort to persuade customers to pay higher prices for upgrades as the smartphone market becomes more mature.

Ternus took over from Cook at the start of September, making the event his first major public product presentation as CEO. His decision to highlight the foldable iPhone as the keynote’s climactic announcement also gives Apple a new flagship product category with which to distinguish its premium lineup.

The iPhone Duo represents Apple’s most significant change to the iPhone’s physical design since Jobs introduced the original model in 2007. When folded, the device functions as a conventional smartphone, while opening it transforms the display into a substantially larger screen.

Ternus used the launch to draw a contrast with existing foldable phones, arguing that competing products have often failed to integrate the two halves of the device into a cohesive experience.

“Others have created foldables that just feel like two phones stuck together,” he said.

Apple is charging a substantial premium for its first entry into the category. The iPhone Duo starts at $1,999, with pre-orders beginning October 16 and the device scheduled to launch October 23.

The price puts the Duo well above Apple’s conventional flagship iPhones and turns the foldable into a product aimed squarely at the premium end of the smartphone market. Its success will therefore depend not only on consumer interest in foldable designs but also on whether customers see the larger display and new form factor as worth paying hundreds of dollars more.

Apple says the Duo uses two batteries and can deliver up to 44 hours of usability when customers use only the outer display, while video playback on the inner screens can reach up to 31 hours. The company is also offering a small kickstand and a protective case designed to shield the edges of the folded device.

The foldable launch came alongside a broader increase in Apple’s hardware prices. The company raised the starting price of its high-end iPhone Pro models by $100, with the iPhone 18 Pro starting at $1,199 and the iPhone 18 Pro Max at $1,299.

Apple has attributed recent price increases across its hardware lineup to the difficult memory-supply environment. MacBooks and iPads have also become more expensive in recent months, increasing the cost pressure facing consumers across Apple’s ecosystem.

The combination of a $1,999 foldable and higher prices for the mainstream Pro lineup gives Apple more room to increase average selling prices, but it also raises the stakes for its upgrade strategy. Consumers who are already holding onto smartphones for longer may be less willing to absorb another price increase unless the new hardware offers a sufficiently meaningful improvement.

Apple’s revamped financing and subscription approach could help address that problem. The company recently overhauled its device subscription program and renamed it Apple Upgrade, allowing customers to access a new iPhone, Apple Watch, iPad or MacBook through monthly payments rather than paying the full cost upfront. The program is powered by buy-now-pay-later provider Klarna.

That model becomes relevant with a foldable phone approaching the $2,000 mark. Spreading the cost over monthly payments could make the Duo more accessible to customers who would otherwise reject its upfront price, while allowing Apple to preserve the premium headline price.

The company also introduced the iPhone 18 Pro and Pro Max with new colors and upgraded computing technology aimed at improving photography and AI features, including the next generation of Siri.

One of the biggest camera upgrades is a variable-aperture system, which Apple said uses six laser-cut blades to control how much light enters the camera. Kaiann Drance, Apple’s vice president of iPhone marketing, described it as the company’s most advanced camera system.

Apple also unveiled new Apple Watch models, including the Apple Watch Series 12 and Ultra 4, with an increased emphasis on health and fitness. A new sensor system takes background heart-rate readings every five seconds throughout the day, including while the wearer is moving.

The company introduced AirPods 5 with a redesigned acoustic architecture and computational audio while retaining the open-ear fit of the standard AirPods. The new models start at $129 with a standard charging case and $149 with wireless charging. Apple is also adding a swipe-based volume control on the side of the earbuds.

The event included a detailed look at iOS 27, with the software update scheduled to launch September 14.

But the foldable iPhone remains the most consequential announcement of the event. Apple is entering a category that competitors have spent years developing, meaning it will need to persuade consumers that waiting for Apple was worthwhile.

The launch also gives Ternus an opportunity to establish a different era for Apple. Cook spent more than a decade building on the foundation created by Jobs, expanding the iPhone ecosystem and turning services and wearables into major businesses. Ternus inherits a company with a massive installed base but faces the harder task of creating new reasons for customers to upgrade.

The iPhone Duo could become one of those reasons if Apple succeeds in making foldable technology feel sufficiently different from the conventional smartphone. Its $1,999 price, however, means Apple is simultaneously testing the limits of what consumers are prepared to pay.