An in-depth look at how a 550% surge in flash memory prices since 2023 is reshaping hardware economics, shifting supplier leverage away from Apple as cloud giants scale up component purchases.
According to TechInsights, flash memory prices have risen about 550% since their 2023 lows, topping 30 cents per gigabyte by some estimates. That same year, the industry posted an operating loss of $19 billion, while Apple made $14 billion in gross profit from selling additional storage on its devices, charging significant amounts for capacity upgrades that cost it little.
Two years ago, Apple was buying almost twice as much memory as Microsoft, Amazon, Meta, and Google combined. Today, the picture has completely reversed. The four tech giants are buying twice as much from Apple, expanding their infrastructure, and entering into long-term supply contracts with manufacturers like Japan’s Kioxia. Companies like Meta, Microsoft, and Amazon have more flexibility in absorbing increased costs, as memory is a smaller percentage of a data center’s total investment and the costs can be spread over time.
As a result of this shift, Apple's annual spending on flash memory is estimated to increase from about $6 billion in 2025 to $25 billion in 2026. The increased cost is limiting the profit margin from memory upgrades in iPhones, as happened with the move from 256 to 512 gigabytes, where the cost to the company rose significantly from $15 in 2025 to $66 in 2026. This pressure has led to price increases across almost all of Apple's product lineup, with CEO Tim Cook likening the sharp price increase to a catastrophic natural phenomenon.
↳
READ ALSO
HACKS.GR / RELATED
Smartphones, Wearables & Gadgets
Dell 14S: The new $649 budget laptop with 22 hours of battery life
↗
In the past, Apple has used its massive order volume to impose strict terms, control supplier finances, and avoid firm delivery commitments. Now, the question remains whether the company can redefine its position in the supply chain, or whether the market has been permanently changed by the impact of artificial intelligence.
>Stay connected with Hacks.gr
Set us as a preferred source on Google and find us on social media.
Preferred source
↗
end of article
Top comments (0)