TechFlow reports, according to TechFlow Research, Morgan Stanley's latest report on Apple released on July 14, 2026 shows that Apple increased prices for Mac, iPad, and accessories by 15-54% within two weeks; the underlying driver is forced cost hedging, rather than simple profit extraction. DRAM and NAND chip costs are expected to rise by 190% and 280% respectively in 2027. The chip cost for an iPad will rise from $51 to $144, and this single item alone could consume 30-40% of the gross margin.
Morgan Stanley predicts Apple will increase iPhone prices by $200 in September (compared to the previously expected $100-150); this is a necessary move to cope with cost pressures. Even with a $200 price increase, most of the incremental gross profit of the iPhone will be offset by rising costs. Morgan Stanley's target price is $360, representing a 34.4% increase compared to the current $317, but the implied risk is whether consumer tolerance for consecutive price increases can be sustained.
