Apple May Add $100 To Higher-End iPhone Models To Counter Memory Costs: Analyst

Apple Inc. (NASDAQ:AAPL) is adjusting its product pricing strategies to mitigate escalating supply chain expenses, according to an analyst note released by Bank of America Securities (BofA Securities) on Thursday.

BofA maintained its Buy rating and price forecast of $380 on the consumer electronics manufacturer.

Pricing Adjustments to Offset Memory Costs

The analyst update followed an exclusive interview published by the Wall Street Journal on Wednesday, where outgoing Apple CEO Tim Cook stated that Apple is forced to raise pricing to counter rising memory component costs.

In response, BofA raised its average selling price estimates by an additional $100 for the iPhone Pro and Pro-Max models, while leaving the base model and Air pricing unchanged. BofA noted this strategy “leverages share gains at the lower end and pushes prices higher in the more inelastic segments.”

Margin Impacts and Demand Projections

BofA factored pricing increases into the Mac and iPad categories, which led to a marginal reduction in unit demand estimates across all product segments.

The firm projected a potential 100-basis-point gross margin headwind for hardware products. However, BofA stated it expects stable service margins with potential upside to serve as an offset, alongside supply chain efficiencies and the use of recycled materials.

Supply Chain Positioning and Capital Advantages

BofA emphasized that Apple remains well-positioned relative to competitors due to its corporate scale and long-term relationships with memory suppliers.

The firm highlighted Apple’s balance sheet as a key differentiator, anticipating that the company’s unit volumes will outgrow the broader smartphone and personal computer end markets.

Financial Estimates and Valuation Outlook

BofA modified its fiscal year 2026 revenue forecast for Apple to $469.8 billion, up from the previous estimate of $468.7 billion.

The corresponding fiscal 2026 earnings per share (EPS) estimate rose to $8.63 from $8.61. The unchanged price forecast of $380 is based on a 37 times multiple of the estimated calendar year 2027 EPS of $10.27.

AAPL Price Action: Apple shares were up 0.45% at $297.29 at the time of publication on Thursday, according to Benzinga Pro data.

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