Hyderabad, August 11: The iPhone 18 Pro could become significantly more expensive to manufacture as soaring memory prices push up Apple’s component costs, according to TrendForce.
The research firm estimates that the bill of materials (BOM) cost of the 256 GB iPhone 18 Pro could rise by around 38% year-on-year compared with its 2025 predecessor.
The sharp increase is being driven mainly by higher memory costs. TrendForce said Apple may absorb part of the additional expense by accepting lower gross margins to avoid a steep increase in retail prices.
iPhone 18 Pro Costs Rise as Memory Becomes Major Expense
Memory is becoming a much larger component of the iPhone’s overall production cost. According to TrendForce, memory accounted for around 10% of the BOM cost of Pro models a year ago.
That share is estimated to have risen to around 34% in the third quarter of 2026. It could exceed 40% in the first half of 2027 if memory prices continue climbing.
The shift marks a major change in the cost structure of Apple’s flagship smartphones. Previously, the application processor and display were among the biggest contributors to the BOM cost.
TrendForce expects the 256 GB iPhone 18 Pro to face substantial cost pressure when it launches in the third quarter of 2026. If memory prices continue rising, production costs could increase even further in 2027.
Apple May Sacrifice Margins to Control iPhone Prices
Apple could follow a strategy similar to its recent MacBook pricing approach by absorbing part of the increased component costs.
By reducing its gross margin, the company could limit the extent of any retail price increase. This may help Apple protect demand, maintain shipment volumes and strengthen its smartphone market share.
Apple could also reconsider the pricing of older iPhone models when the new generation launches. Higher prices for previous-generation models could help the company offset some of the additional memory costs.
The impact could be even greater for Android smartphone manufacturers. Brands operating with thinner margins may have less room to absorb higher component costs.
TrendForce said Android manufacturers could therefore pass a larger share of rising production costs on to consumers. This could result in bigger price increases across several Android smartphone segments.
The pressure is expected to be particularly severe in the entry-level and mid-range markets, where profit margins are already limited.
TrendForce noted that memory prices have increased several times since the beginning of 2025. Continued increases could force some manufacturers to raise prices substantially or discontinue models that become unprofitable.
The research firm expects global smartphone production to remain under pressure from the second half of 2026 through 2027. Persistent memory cost increases could weigh on both smartphone demand and manufacturers’ profitability.
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