Apple expects “significantly higher memory costs” in late 2026, CEO Tim Cook said Thursday during Apple’s second-quarter earnings call, as the tech giant faces downward pressure. lack of memory which affects the entire industry.
Cook — who stepped down as CEO on Sept. 1 and will be replaced John Ternusthe company’s senior vice president of hardware engineering — said Apple was partially unaffected by the memory shortage this quarter, as it already has more devices in stock. But outside of June, costs will rise.
“We believe that memory costs will have an incremental impact on our business, and we will continue to evaluate this,” Cook said. “We will look at a range of options.”
As AI data centers continue to be developed to meet the growing demand for AI services, their demand for memory and other components has reduced the supply of consumer devices, driving up the cost of laptops and phones such as Apple’s MacBooks again the iPhoneas well as foreign end products.
Analysts are looking at how Apple will meet demand amid rising memory costs and supply constraints in the future, said Nabila Popal, senior director of research at International Data Corporation.
“While Apple remains in a better position than its competitors to manage the memory crisis and get the supply it needs, the key question will be deciding the right balance between raising prices and maintaining profitability or focusing on gaining share by not raising prices,” said Popal.
Cook said the main limitation now is “the availability of advanced nodes that our SOCs are produced on,” rather than memory, which is affected The iPhone. Going forward, he said this may have an impact on those as well The Mac Mini, Mac Studio again MacBook Neo in particular, they have been given their tools of artificial intelligence and popularity.
Customers have jumped to the desktop Mac Mini and Mac Studio for use with AI agents, Cook said, and it may take several months for supply of those computers to recover. He did not say when the MacBook Neo will be restocked to meet demand.
“Customer response to the Mac Neo has been off the charts, with demand exceeding expectations and a record March quarter for customers,” Cook said.
Overall this quarter, Apple announced $111 billion in revenue, up 17%, which Cook attributed to “extraordinary demand for the iPhone 17 lineup.”
During the call, Cook highlighted the Apple Intelligence AI features integrated into the iPhone 17 as a driver of its popularity, along with its improved camera, design, performance and durability.
“We’re seeing double-digit growth in most of the markets we track,” Cook said. “And we set a new record for the March quarter for developers.”
Since US companies can now apply refunds for jobs they pay to the US government because of President Donald Trump’s foreign tariffs in 2025, Cook said that Apple is following the process and “will reinvest any money we get into US innovation and advanced manufacturing.”
Trump had invoked the International Emergency Economic Powers Act of 1977 to authorize a tariff increase on imports from around the world last year, but the Supreme Court struck down those charges in February. Before the decision — which said the emergency powers law does not authorize the use of taxes to fight national emergencies — the US government collected an estimated $166 billion from US companies, including Apple.
Apple in AI
When asked about AI, Apple noted that it is “obviously investing heavily” in both operational and R&D expenses. While AI is “a very important area of investment for Apple,” the company will be exploring it further beyond its regular product development and rollout.
According to industry analyst Emarketer, Apple’s AI strategy and its collaboration with Google Gemini for Siri it will be important going forward.
“The results suggest that Apple continues to face the global crisis, pointing to the resilience of the tech chain,” Emarketer technology analyst Jacob Bourne said in a statement. “The question is whether incoming CEO John Ternus can translate this momentum into a credible AI strategy (and) Apple’s willingness to rely on outside AI innovators.”
During the earnings call, Cook couldn’t be more specific about what to expect next from the An overhaul of Siri AI beyond teasing its upcoming arrival, he also didn’t comment on the rise of AI agents on phones (and how they might play out on future iPhones). But he acknowledged that working with Google on AI is going well, saying, “We’re happy where things are, and we’re happy with the work we’re doing independently.”
And while Cook will be CEO for one full quarter and next earnings report, when asked if he had any advice for his successor, Ternus, he noted that one of the most important decisions he will make is where to spend his time — ideally, where it will be most beneficial to the company and its customers. And again, to never forget Apple’s northern star.
“We will make the best products in the world that will truly enrich other people’s lives,” said Cook. “If you continue to focus on that and make your decisions about that, it’s going to produce a good business, and we’re going to be able to build more products and do it again.”
