Apple's newly appointed Chief Executive Officer, John Ternus, stated in his first earnings call that the company expects memory costs to rise further, following increases in the September quarter. He noted that these higher costs are partly offset by factors such as existing inventory, lower prices for non-memory components, and recent price adjustments on Apple products. Apple had previously increased prices for Macs and iPads in June, and for iPhones in September, in response to the tightening memory and storage supplies.The global technology industry has experienced a significant shortage of high-bandwidth memory chips since last year. This scarcity is largely driven by the surging demand from AI data centers, which has prompted chipmakers to redirect their manufacturing capacity towards the AI sector. This shift has created an imbalance in supply, particularly affecting consumer electronics manufacturers like Apple. SK Hynix, a major South Korean semiconductor company and Apple supplier, has indicated that it expects this chip shortage to persist until at least 2030.Apple's Chief Financial Officer, Kevan Parekh, also noted that the company's efforts to enhance its AI capabilities, particularly with Siri AI, will impact profit margins due to associated cloud costs. Apple's gross margin is projected to decrease from 47.9 percent in the September quarter to between 45 and 46 percent in the December quarter, primarily due to these rising memory costs and Siri AI expenses.The company's executives have been vocal about the intensifying memory supply crunch for several months. In Apple's third-quarter earnings call in July, former CEO Tim Cook characterized the surge in memory prices as a "100-year flood." At that time, Cook stated that Apple expected memory prices to increase in the near term.Historically, Apple has held significant leverage over flash-memory suppliers, often negotiating aggressive pricing. However, the substantial increase in demand from hyperscale data centers for AI applications has altered this dynamic. Two years ago, Apple's flash memory purchases were approximately double the combined total of Microsoft, Amazon, Meta, and Google. Now, these four companies collectively purchase about twice Apple's share. TechInsights, a research firm, estimates that Apple's flash storage purchasing costs are projected to reach $25 billion this year, a more than fourfold increase from the approximately $6 billion spent in 2025.Despite these cost pressures, Apple reported stronger-than-expected fiscal fourth-quarter results, with revenue exceeding market expectations at $114.48 billion. However, the positive revenue figures were tempered by the executives' outlook for the upcoming quarter, leading to a drop in Apple's shares in after-hours trading.