Analysts at J.P. Morgan estimate that the bill of materials for Apple’s most affordable iPhone 18 Pro configuration will rise just 5% to $540, compared with the 256 GB iPhone 17 Pro. The modest increase reflects Apple’s efforts to deploy cost-saving measures as a partial buffer against rising DRAM and NAND flash prices.
Storage tiers drive significantly higher costs
A separate assessment from Counterpoint Research paints a sharper divide further up the storage ladder. Production costs for the 1 TB iPhone 18 Pro Max are projected to jump roughly $300 relative to its predecessor, while the range-topping 2 TB model will reportedly see an even wider gap. Beyond memory, the firm points to the A20 Pro chipset and upgraded camera system as key cost drivers, noting that many other components—including the display—are on track to become slightly less expensive than last year.
Pricing adjustments and margin pressure
To absorb these increases, Apple is expected to lift the average price of the iPhone 18 Pro Max by around $200, with the steepest hikes applied to higher-capacity variants. For context, the current 256 GB iPhone 17 Pro Max retails for $1,199 and the 2 TB edition reaches $1,999. Despite the planned price adjustments, analysts believe Apple will have to accept narrower profit margins compared with the prior generation, as component cost growth outpaces its ability to pass expenses fully onto consumers.
Design shifts reinforce the cost story
The projected bill-of-materials pressure aligns with broader supply chain signals pointing to meaningful hardware updates. A thicker, heavier chassis is expected to accommodate a larger battery, while the anticipated A20 Pro silicon and refined camera array underscore the engineering investment behind the new Pro Max tier. These design choices help explain why storage-heavy configurations are outpacing typical cost curves and why pricing, particularly for 1 TB and 2 TB models, is poised to move beyond current flagship thresholds.
Source: counterpointresearch.com