Apple Stock Is at Risk From Nintendo's Memory-Chip Crisis -- Barrons.com

By Adam Clark

Nintendo stock fell on Monday after the Japanese videogame company warned it would need to raise the prices of its hardware to cover the rising cost of memory chips. It's a warning for Western device makers, including Apple.

Nintendo shares closed down 8% in Tokyo. The market was catching up with a weaker sales forecast for its flagship Switch 2 console from Friday. Nintendo expects to sell 16.5 million Switch 2 consoles in its current fiscal year, down from the 19.9 million sold in its fiscal year ended March.

Part of the problem is higher prices. Nintendo said Friday that it will raise Switch 2 console prices in Japan, the U.S. and some other regions. The device will cost about $500 in the U.S. from September, up from about $450 currently.

"These actions are intended to offset higher input costs, including tariffs and component inflation, particularly memory," Benchmark Research analyst Mike Hickey wrote in a research note.

The huge demand for memory and storage components in artificial-intelligence servers is driving up prices across the hardware industry. Memory prices in the first three months of 2026 nearly doubled from the prior quarter, according to research firm Trendforce.

Apple has shrugged off memory-chip price pressures so far. However, its ability to maintain its margin will be tested in the second half of the year. Memory can make up around 10%-15% of the total bill of materials for a high-end smartphone such as an iPhone according to the research firm IDC.

"I can tell you that beyond the June quarter, we believe memory costs will drive an increasing impact on our business and we'll continue to evaluate this," CEO Tim Cook said on Apple's earnings call at the end of April.

New Apple CEO John Ternus takes over from Cook on Sept. 1. One of the first questions he will face is whether to raise the price of the coming iPhone 18 range to cover memory costs and potentially put off consumers, or hold prices and risk investors taking fright at shrinking margins.

Write to Adam Clark at adam.clark@barrons.com

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May 11, 2026 07:38 ET (11:38 GMT)

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