It’s the year of smartphone price hikes

Apple unveiled the iPhone 18 Pro at $1,199 and the Pro Max at $1,299, each $100 higher than the previous generation, and even its older models received the same $100 bump. Google followed suit with the Pixel 11, now starting at $899, up $100 from the Pixel 10. Samsung’s latest foldable, the Galaxy Z Fold 8 Ultra, entered the market at $2,099, a full $100 premium over the Z Fold 7. The trend is not confined to the “big three.” Sony’s Xperia 10 VIII is priced £150 more than its predecessor, and Motorola’s newest Razr flip phones also carry a $100 increase despite modest hardware changes. The price hikes are traced to a sustained shortage of key components—especially DRAM—exacerbated by the rapid expansion of AI data centers. Nothing’s CEO Carl Pei disclosed that memory costs for the Nothing Phone 4A doubled before launch, and Qualcomm recently raised its processor pricing, confirming that the cost pressure spans the entire supply chain.

These moves signal a structural shift in the smartphone market. Historically, manufacturers have used price cuts or incremental upgrades to keep entry‑level devices under $100, preserving a large volume segment. The current data suggests that segment is eroding; sales figures show sub‑$100 phones slipping toward obsolescence. By raising prices across the board, firms are effectively re‑positioning their portfolios toward higher‑margin, premium devices, betting that consumers will accept higher costs in exchange for incremental performance gains or brand cachet. This aligns with a broader industry pattern where AI‑driven demand for chips and memory inflates costs for all downstream products, from laptops to wearables.

Looking ahead, the sustained component scarcity could force further price escalations or trigger a wave of cost‑saving innovations, such as greater reliance on older process nodes or modular designs. Consumers may increasingly turn to refurbished phones or alternative ecosystems if price growth outpaces perceived value. Watch for how quickly competitors like Xiaomi or Oppo respond—whether they absorb cost shocks to protect market share or adopt similar pricing, and monitor any supply‑chain interventions (e.g., new memory fab capacity) that could temper the upward pressure.