Qualcomm did something Tuesday that almost guarantees you'll pay more for Android or iPhone handsets
Qualcomm CEO Cristiano Amon says Qualcomm cannot keep eating supplier price hikes.
Qualcomm price hike to affect what you pay for your next phone | Image by Qualcomm
Higher smartphone prices are pretty much baked into consumers' minds thanks to higher chip costs. We've previously discussed how RAM prices have soared as memory chip manufacturers like Samsung, Micron, and SK Hynix are forced to make a decision that weighs heavily on smartphone prices.
AI-related DRAM shortage leads to higher smartphone prices
Because they have a finite amount of resources to work with, these three manufacturers have decided to reduce the production of DRAM chips for smartphones in order to produce more High-Bandwidth Memory (HBM) chips for AI data centers. HBM chips have a higher profit margin than DRAM chips, and the demand for them is extraordinarily high. The decision to produce HBM chips over DRAM chips is an important one, but it is not surprising.
A 12GB LPDDR5X DRAM module last year cost an estimated $40 to $50 wholesale. As of the second quarter of 2026, that same module had a wholesale price of $145.90. Someone has to pay for that increase and it is usually the smartphone buyer who does by shelling out more money for a new phone.
Another factor leading to higher smartphone prices is chip designer Qualcomm's price hike taking place starting yesterday, September 1. The San Diego-based company had first informed its customers about an impending price hike back in July. My colleague Anam discussed the double-digit price hike for chipsets that Qualcomm revealed late in July.
Qualcomm CEO Amon says the company cannot afford to eat higher costs
Qualcomm CEO Cristiano Amon says that Qualcomm can't continue to eat higher supplier costs. Explaining the higher prices for its chipsets, the executive said, "We're just passing through big cost increases that we have."
Apple still uses Qualcomm's 5G modem chips for some of the iPhone 17 series. The iPhone 17, iPhone 17 Pro, and the iPhone 17 Pro Max are equipped with the Snapdragon X80 5G modem. The iPhone Air and the iPhone 17e use Apple's in-house C1X modem. It's possible that Apple will resort to dual-sourcing for the iPhone 18 Pro and iPhone 18 Pro Max.
Read more about the iPhone 18 Pro line:
Apple to use dual-sourcing for iPhone 18 Pro, iPhone 18 Pro Max modem chips
The iPhone 18 Pro series outside of the US would use Apple's faster C2 in-house modem. While the C2 supports faster 5G speeds than the C1X, it still does not work with mmWave frequencies, which offer the fastest 5G data speeds in the US. As a result, the US variants of the iPhone 18 Pro and iPhone 18 Pro Max will feature the Snapdragon X80 5G modem because that component includes mmWave support.
Truthfully, most US smartphone users never connect to mmWave unless they find themselves in a major metropolitan area like New York City. That's because mmWave signals travel short distances. As a result, the fastest data speeds US smartphone users experience usually come from mid-band frequencies.
Qualcomm expects revenue from Apple to decline faster than estimated
Even though the dual-sourcing means that Apple will still be writing checks to Qualcomm, CEO Amon said last month that Qualcomm's revenue from Apple will still decline faster than previously estimated. He expects to see a 50% decline in revenue from Apple between the third quarter and the fourth quarter.
Qualcomm is looking to hike prices across its mobile lineup, which includes various application processors for Android phones across categories from flagship (Snapdragon 8 series), mid-range (Snapdragon 7 series, Snapdragon 6 series), entry-level and budget lines (Snapdragon 4 series).
Apple iPhone 18 Pro renders.| Image by MacRumors
Qualcomm also designs Wi-Fi, Bluetooth, and Location combination chips, Power Management Integrated Circuits, and Fingerprint and Security chips. With Qualcomm raising prices, smartphone manufacturers will have to pay more for Snapdragon components. Those price hikes will be passed along to consumers buying Android or iPhone handsets.
What is to blame the most for higher smartphone prices this year?
Next week, we will know exactly whether Apple is raising the price of an iPhone Pro Max model for the first time since 2023 when the starting price of the iPhone 15 Pro Max was increased by $100 to $1,199. However, that increase was offset by the elimination of the base model with 128GB of storage. Thus, the iPhone 15 Pro Max with 256GB of storage was priced at the same $1,199 as the iPhone Pro Max with 256GB of storage.
Nonetheless, comparing starting prices, Apple did indeed raise the iPhone 15 Pro Max by $100. Apple made a similar move last year with the iPhone 17 Pro as it increased the starting price of that model by $100 to $1,099, but also eliminated the 128GB variant. Thus, the price of the iPhone 17 Pro with 256GB of storage was the same as the price of the iPhone 16 Pro with 256GB of storage.
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