Wall Street Journal reports iPhone 18 Pro could start at $1,399 due to AI memory shortage

AI memory crunch could push iPhone 18 Pro to $1,399, WSJ estimates Apple has confirmed broad price increases across its product lineup, and The Wall Street Journal's analysis now projects the iPhone 18 Pro could start at $1,399 or higher, a $200 to $300 jump over the $1,099 iPhone 17 Pro. The culprit isn't inflation or Apple padding margins. It's an AI-driven memory shortage.

Manufacturers including Samsung Electronics and Micron Technology have shifted production toward enterprise-scale DRAM and NAND chips for AI servers, squeezing supply for consumer electronics like the iPhone. Prices for memory and flash storage are projected to roughly quadruple by this fall compared to last year, according to research firm TechInsights.

Apple CEO Tim Cook acknowledged the severity of the situation in an interview with The Wall Street Journal on June 17. "Unfortunately, price increases are unavoidable," Cook said.

He described the commodity price swing as unprecedented: "This is a hundred-year flood. I've never seen anything like it in any area in over 40 years." Asked which devices would see increases and when, Cook said the company is "still working through that."

TechInsights broke down the numbers. Apple paid roughly $39 for the 12GB of DRAM in the iPhone 17 Pro, a cost that could climb to $145 in the iPhone 18 Pro. The 256GB flash storage tier rose from about $13 to a projected $51.

Combined with other components, the total estimated bill of materials for the base iPhone 18 Pro jumps 25% to around $726. To preserve the 47% gross margin Apple enjoyed on the iPhone 17 Pro. The company would need to charge $1,371.

But Apple prefers standardized pricing, making $1,299 more likely, a 44% margin, per TechInsights and the Journal's analysis. That math doesn't include a new camera system. Supply chain analyst Ming-Chi Kuo says the upgraded camera module could cost Apple 50% more than the previous generation.

Factoring that in, the Journal estimates the iPhone 18 Pro starts at $1,399 or higher. The iPhone 18 Pro Max would likely start $100 above the Pro, consistent with the current gap between models.

Both are expected to launch in September alongside the foldable iPhone Ultra, which has been rumored at roughly $2,000. The regular iPhone 18 isn't expected until next spring and could hold at $799, but that depends on whether the memory shortage persists.