Apple Inc. (NASDAQ:AAPL) has reportedly asked some suppliers to cut component orders for its latest flagship iPhones by at least 15%, as price increases driven partly by soaring AI-related memory costs weigh on demand.
Nikkei Asia reported Friday that Apple scaled back its October component orders for the iPhone 18 Pro and Pro Max after demand fell short of expectations.
Both models launched in September at prices $100 above their predecessors, starting at $1,199 and $1,299, respectively.
AI Memory Boom Pushes iPhone Costs Higher
The estimated cost of memory in the 256GB iPhone 18 Pro has surged nearly 400% year over year, according to TrendForce. Memory now accounts for 34% of the phone’s component costs, up from just 10%.
AI data centers are driving up demand, prompting chipmakers to prioritize more profitable server memory. Apple Executive Chairman Tim Cook, then CEO, called the surge a “100-year flood” in July.
Samsung Electronics (OTC:SSNLF) is experiencing both sides of the boom. Soaring memory prices helped it forecast record quarterly profits, even as surging chip costs pushed its own smartphone business into losses.
Apple Was Supposed to Be the Exception
IDC forecasts global smartphone shipments will fall 16.7% this year, with Android shipments plunging 24.3%. Apple’s iOS shipments, however, are expected to decline just 1.3%.
Apple’s latest launch initially looked strong. Counterpoint reported September 30 that iPhone 18 Pro sales in China rose 12% year over year during their first three days.
But UBS analysts warned that delivery waiting times were shrinking across more than 30 markets despite relatively stable supply, according to Nikkei.
“Declining wait times against a stable supply backdrop is an increasing concern in our view,” the analysts wrote.
Still, the reported cuts concern component orders, not actual sales. Nikkei noted that Apple’s staggered launch schedule, which pushes the standard iPhone 18 into early 2027, may also explain some of the weakness.
Can Apple Find Cheaper Memory?
Apple has explored alternative suppliers. The Financial Times reported in June that the company sought US government assurances over buying memory chips from China’s ChangXin Memory Technologies (CXMT).
On Polymarket, traders gave Apple a 14% chance of announcing plans to use CXMT chips or confirming a supply agreement by year-end. The market had attracted approximately $24,500 in trading volume.
Apple shares fell approximately 2.7% in Friday’s premarket trading after closing Thursday at $340.42.
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