Apple, Samsung and Google have all raised prices this year, with soaring memory costs emerging as a key factor.
The iPhone 17 went on sale in the UAE a year ago at Dh3,399. Apple still lists the model today, but its price has risen to Dh3,799. Nothing about the phone has changed. It is part of a broader price increase that hit PCs first and has now spread to smartphones.
The iPhone 17 is hardly an isolated case. The new iPhone 18 Pro and Pro Max cost more than last year’s models, while Samsung’s Galaxy Z Fold8 Ultra is Dh400 more expensive than the Galaxy Z Fold7 it replaces. Google, meanwhile, has raised prices across its Pixel 11 lineup.
Phones typically become cheaper as they age. The discount on the previous year’s model is often how consumers time a purchase, but that pattern has broken this year. The same factor is pushing up the prices of new iPhones, Galaxy devices and Pixel phones: memory costs have risen sharply, prompting manufacturers to pass some of the increase on to consumers.
What is happening to phone prices?
Apple’s price increase was unusual because it affected models already on the market. Alongside the launch of the new iPhone 18 Pro models on September 9, the company raised the prices of the iPhone 16, iPhone 17, iPhone Air and iPhone 17e by $100 each in the United States.
In the UAE, the iPhone 17, iPhone Air and iPhone 17e each became Dh400 more expensive. None of the four models was redesigned or relaunched. These devices would normally receive price cuts at this point in the product cycle, making this year’s increases particularly notable.
Elsewhere, the specifications have shifted alongside prices. Google increased the Pixel 11 Pro’s price by $100 and reduced the base model’s memory from 16GB to 12GB, citing what it described as a severe, supplier-driven shortage of RAM.
Samsung, meanwhile, is reportedly considering a price increase for the Galaxy S26 in South Korea from October 1, although the company has said no decision has been made.
Counterpoint Research estimates that prices of smartphones already on sale have risen by about 15 per cent globally this year and 18 per cent across the Middle East and Africa. New models are launching at around 25 per cent more than the devices they replace. More than four in 10 phones tracked by the firm have seen a price increase — a trend it says is unprecedented.
The impact is more pronounced in the budget and mid-range segments, where memory accounts for a larger share of a phone’s manufacturing cost.
So what is causing it?
The main driver is memory. DRAM and NAND prices have risen by more than 300 per cent year on year, while IDC says manufacturers have limited room to absorb the higher costs.
A year ago, memory and storage accounted for about a tenth of the cost of building an iPhone Pro. This quarter, they account for about a third, and TrendForce expects the figure to exceed 40 per cent by mid-2027.
RAM prices are surging partly because memory manufacturers are diverting capacity towards high-bandwidth memory (HBM), the stacked DRAM used alongside AI accelerators in data centres. HBM commands higher prices than conventional memory used in smartphones.
HBM also requires more silicon for each usable bit, meaning that shifting production towards it can further constrain supplies of conventional RAM at a time when overall demand for memory remains exceptionally strong. Tim Cook, then Apple’s chief executive, described the situation as “a hundred-year flood” in a Wall Street Journal interview in June.
Not everyone agrees that the price increases are driven solely by supply and demand. Samsung, SK Hynix and Micron, which together account for about 90 per cent of the DRAM market, were sued in California in June by consumers and small businesses alleging that the companies used the AI boom as cover to keep conventional memory supplies tight. The manufacturers deny collusion, while courts dismissed a similar claim in 2022.
How long will this last?
There is little relief in sight, with the memory shortage potentially lasting beyond the lifespan of many current smartphones. SK Hynix, one of the three major memory manufacturers, expects 2027 to be more challenging than 2026 and says demand could outpace production capacity beyond 2030.
Intel chief executive Lip-Bu Tan offered a more specific timeframe earlier this year, saying conditions were unlikely to ease until 2028.
Adding manufacturing capacity could, in theory, ease the pressure, but it is not a quick fix. A new memory plant can cost upwards of $15 billion (Dh55 billion) and take at least 18 months to come online. Micron’s Singapore fab is due to start production in 2027, followed by Samsung’s Pyeongtaek expansion in 2028 and SK Hynix’s Indiana facility towards the end of 2028.
That represents a shift from the underinvestment seen in 2024 and 2025, but the impact of these new facilities is unlikely to be felt in the near term.
Will phone prices ever come back down?
Unlikely — and there is already evidence to suggest why. Memory prices fell sharply in 2022 and 2023, but smartphone prices did not follow. The global average selling price continued to rise two years later, suggesting that savings from lower component costs do not necessarily make their way to consumers.
The impact is greatest at the bottom end of the market. FDM and CCS Insight say some entry-level phones have already become more than 50 per cent more expensive than they were a year ago. IDC now describes the sub-$100 segment, equivalent to about Dh370, which shipped 173 million phones in 2025, as facing an existential crisis. Gartner expects buyers in this segment to leave the market five times faster than premium-phone buyers.
The era of the ultra-cheap smartphone may not return.
For consumers, that means if your current phone still works, replacing it may be harder to justify this year, with the pressure potentially continuing into next year. If you do need a new phone, choosing the storage capacity you actually need rather than paying for more than necessary can help keep the cost under control.
