Apple raises laptop and tablet prices amid global memory chip shortage

Apple has increased the prices of selected MacBooks and iPads worldwide, citing a sharp rise in the cost of memory and storage chips driven by growing demand from artificial intelligence data centres.

The technology company said some laptops and tablets have risen in price by almost 20%, describing the current market as an “unprecedented challenge” caused by an “extraordinary surge” in demand for components.

“We have never seen a component price increase this much, this quickly,” Apple said, adding that it was working to find solutions.

Among the affected products is the MacBook Pro with one terabyte of storage, which has increased in price in the United States from $1,699 to $1,999. In the UK, Apple’s entry-level Neo laptop has risen from £599 to £699 only months after its launch.

Apple said it had previously absorbed the higher costs but had now reached the point where it needed to raise prices on several products, including MacBooks and iPads.

The announcement was followed by Microsoft’s Xbox division confirming a second major price increase for its gaming consoles in less than a year, also blaming rising memory and storage costs.

From August, the basic Xbox console will increase by $100 to $499, while the higher-capacity model will rise by $150 to $749. Following an earlier increase introduced in October, the price of a new Xbox console will be between 30% and 40% higher than it was a year ago.

Xbox said it had hoped to avoid another increase but argued that the wider electronics industry was being affected by a continuing components crisis.

“The entire consumer electronics industry is struggling with the current components crisis, but the effects are particularly hard on consoles,” the company said.

It added that the cost of memory and storage components had already more than doubled and was expected to double again by 2027, suggesting further price increases could be possible.

Industry analysts said the growing demand for memory chips used in AI data centres has disrupted the balance between supply and demand, driving up costs across the consumer electronics sector.

Tech analyst Paolo Pescatore said Apple’s decision showed that the AI boom was now affecting consumer electronics and demonstrated that even the world’s largest technology companies were no longer insulated from rising component costs.

Market research firm Counterpoint said other PC and tablet manufacturers were likely to follow Apple by increasing prices, reducing discounts on entry-level products or shifting their focus towards premium devices.

Forrester analyst Dipanjan Chatterjee said Apple’s strong brand loyalty meant the company was well placed to withstand higher prices with limited customer backlash.

Apple chief executive Tim Cook had earlier signalled that price increases were likely, telling the Wall Street Journal that they had become “unavoidable” because of the “unsustainable” situation surrounding memory chip supply.

The higher component costs are affecting a broad range of technology products. Gaming company Valve also recently increased the launch price of its Steam Machine, which is now priced at £879 in the UK and $1,049 in the United States.