AI Data Centers Squeeze iPhone Supply Chain

Apple's iPhone business is facing a significant challenge as the global chip capacity tightens due to increasing demand from artificial intelligence (AI) data centers.

The AI servers are consuming premium memory capacity, leaving smartphone producers like Apple struggling to secure conventional DRAM supply.

This has resulted in some smartphone-memory prices more than quadrupling, with potential relief delayed until late 2027 or 2028.

Apple's enormous purchasing power offers leverage, but it cannot manufacture new factories overnight to address the shortage.