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Memory Component to Reportedly Account for 45 Percent Value of an iPhone Due to Supply Chain Issues

Memory Component to Reportedly Account for 45 Percent Value of an iPhone Due to Supply Chain Issues

Apple could absorb a portion of these increased costs rather than passing them entirely to consumers, as per the report.

Written by Shaurya Tomer, Edited by Ketan Pratap | Updated: 30 April 2026 09:02 IST

Memory Component to Reportedly Account for 45 Percent Value of an iPhone Due to Supply Chain Issues

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Highlights

Global memory shortage threatens significantly higher iPhone costs
Apple is said to be securing memory supply aggressively at higher prices
John Ternus is expected to take over as Apple's new CEO this year

Apple is said to be heading into one of its most challenging supply chain phases. According to a report, global memory shortage threatens to increase the cost of future iPhones significantly. The primary culprit is likely to be the memory component, which, historically, accounted for a relatively small portion of smartphone manufacturing costs. However, it may reportedly account for nearly 45 percent of an iPhone's total value by 2027, as demand for AI data centres continues to rise.

Memory Crisis Could Reshape iPhone Pricing

According to a report, the ongoing memory crunch is fueled by soaring demand from AI infrastructure companies. It has reportedly pushed prices sharply higher. Traditionally, memory has accounted for roughly 10–15 percent of a smartphone's bill of materials (BoM), but analysts have warned that this figure could rise dramatically in the coming years.

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Some companies may struggle to absorb the rising costs, which could potentially lead to consolidation in the industry. Apple, on the other hand, may choose a different strategy. Reports suggest the company could absorb a portion of these increased costs rather than passing them entirely to consumers. The company has already been aggressively securing memory supply, even at higher prices, indicating a willingness to adapt to the changing market.

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The development comes at a pivotal moment for Apple's leadership. John Ternus is expected to take over as CEO later this year. Financial Times reports that the executive could inherit a complex set of challenges spanning supply chain diversification, pricing strategy, and geopolitical tensions.

The tech giant is said to be simultaneously working to reduce its reliance on China by expanding manufacturing in regions like India and the US. However, much of its supply chain, particularly for critical components like memory, reportedly remains heavily dependent on a small group of global suppliers.

The latest market research reportedly revealed that the global smartphone chip shipments declined by eight percent in Q1 2026, affected by constrained memory supply. On the other hand, Apple and Samsung's chip shipments continued to grow.

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Shaurya Tomer

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Shaurya Tomer is a Sub Editor at Gadgets 360 with 2 years of experience across a diverse spectrum of topics. With a particular focus on smartphones, gadgets and the ever-evolving landscape of artificial intelligence (AI), he often likes to explore the industry's intricacies and innovations – whether dissecting the latest smartphone release or exploring the ethical implications of AI advancements. In his free time, he often embarks on impromptu road trips to unwind, recharge, and ...More