Apple stock tumbles 5% as MacBook, iPad price hikes wipe $275 billion from market cap

Apple Inc. shares shed more than 5% Thursday after the company announced sweeping price increases on its MacBook and iPad product lines, citing an unprecedented shortage of memory and storage chips driven by the artificial intelligence boom.

The price hikes, which went live on Apple’s online retail store Thursday, are in effect globally and cover the MacBook Neo, MacBook Air, MacBook Pro, iPad Air and iPad Pro lines. The company did not raise iPhone prices.

Apple’s online store briefly went down Thursday morning before updating with the new prices. By Thursday afternoon, shares had fallen roughly 5.3%, lowering the company’s market value by roughly $275 billion to just over $4 trillion. 

The slide pushed Apple to within striking distance of Alphabet in global market capitalization. Heading into Thursday’s session, Nvidia led all companies with a market cap of roughly $5.4 trillion, followed by Apple and Microsoft — though Alphabet has been trading places with Apple in recent weeks. The roughly $275 billion erased Thursday narrowed Apple’s lead over the Google parent to a razor-thin margin, according to intraday data reported by Forbes. 

The specific increases are steep. The starting price of the MacBook Neo rises to $699 from $599, while the MacBook Air increases to $1,299 from $1,099. The entry-level 14-inch MacBook Pro moves to $1,999 from $1,699, while the 11-inch iPad Pro rises to $1,199 from $999. The iPad Air, a mid-tier tablet, is now priced at $749, up from $599.

Apple described the situation in stark terms. A company spokesperson said Apple has “never seen a component price increase this much, this quickly” and that while it has “shielded our customers from these increases so far,” it has “now reached a point where we need to begin raising prices on a number of products including today’s increases for iPad and Mac.”

The company added: “We know this is not welcome news, and we are working tirelessly to find solutions.” 

CEO Tim Cook had foreshadowed the move. In an interview with The Wall Street Journal last week, Mr. Cook said price increases had become “unavoidable” because of higher component costs, warning that there is “less supply at a time when consumers want devices, and the memory guys are passing along huge price increases.”

He previously described the crisis to the Journal as a “hundred-year flood” unlike anything he had witnessed in more than four decades in the industry. 

The root cause is a global shortage of dynamic random access memory, the chips that power virtually all modern consumer electronics. Conventional DRAM contract prices rose as much as 90% to 95% quarter-over-quarter in the first quarter of 2026, according to industry tracker TrendForce, with further increases of 58% to 63% projected for conventional DRAM in the current quarter. The surge — dubbed “RAMageddon” by some analysts — stems from a boom in AI data center construction, with companies such as Nvidia signing long-term supply deals with memory manufacturers and diverting chips away from the consumer market. Micron said Wednesday it has locked in $22 billion in such long-term supply commitments. 

Micron’s most recent earnings report illustrated the scale of the shift. The company’s revenue more than quadrupled in its fiscal third quarter, rising from $9.3 billion a year earlier to $41.46 billion, as demand tied to the AI boom drove record results across memory and storage products. Goldman Sachs and Morgan Stanley have predicted the undersupply will persist and keep memory prices elevated through at least 2027.

Apple is not alone in passing costs to consumers. Nintendo told customers its flagship console will cost $50 more beginning in September, and Sony and Microsoft have also recently raised prices on their PlayStation and Xbox consoles. Lenovo has increased PC and server pricing, while Dell and HP have raised laptop prices as well. 

The Neo price hike also neutralizes what had been a competitive edge Apple held over Dell’s newly launched XPS 13. The XPS 13 went on sale earlier this month at $699 for general consumers — now matching the MacBook Neo’s new price exactly, erasing the $100 gap that had separated them since the Neo’s March launch. 

Despite the market reaction, Wedbush analyst Dan Ives maintained an outperform rating and a $400 price target on Apple, arguing the company’s focus on premium consumers insulates it from significant customer losses. 

The next major product question is the iPhone. Apple’s next run of phones — including a major new foldable model expected to carry a starting price exceeding $2,000 — is set for a September unveiling. John Ternus, who most recently served as Apple’s head of hardware engineering, will inherit the memory crisis when he steps into the CEO role on Sept. 1, succeeding Mr. Cook.