Apple's iPhone 18 Pro May See Price Hike Due to Expensive 2nm Chipset

Apple's upcoming iPhone 18 Pro could see a price increase next year due to the high cost of its 2nm processor, which is expected to power the iPhone 18 series. The production cost of the 2nm processor is reportedly nearly 50% higher than its predecessor, with TSMC's capital expenditure for developing the 2nm process being enormous. This means that even with Apple's significant buying power, the company won't receive any special discount from TSMC, resulting in a production cost per chip that is at least half again as much as the previous generation. Alongside the processor's high cost, the overall bill of materials (BoM) for smartphones is also increasing, with prices for components such as storage modules and camera assemblies on the rise.

Key Takeaways:

• The 2nm processor, which will power the iPhone 18 series, has a production cost nearly 50% higher than its predecessor.
• TSMC's capital expenditure for developing the 2nm process has been enormous, resulting in a high production cost per chip.
• Apple won't receive any special discount from TSMC, despite its significant buying power, which will result in a higher cost per chip.
• The overall bill of materials (BoM) for smartphones is increasing, with prices for components such as storage modules and camera assemblies on the rise.
• The A18 processor used in the iPhone 16 series cost Apple about $45 out of a total estimated $416 in manufacturing costs, roughly 10% of the device's total build cost.
• The rear camera assembly is the most expensive component, with growing complexity and cost with each new iPhone generation.
• Apple may be forced to raise launch prices for the iPhone 18 Pro models to offset the high cost of the 2nm processor.

Sources:

• China Times
• Digitimes

Statistics:

• The production cost of the 2nm processor is nearly 50% higher than its predecessor.
• TSMC's capital expenditure for developing the 2nm process is enormous, but specific numbers are not mentioned.
• The A18 processor costs Apple about $45 out of a total estimated $416 in manufacturing costs, roughly 10% of the device's total build cost.
• The yield of usable chips per batch for the 2nm process has recently reached acceptable levels at above 70%.
• The overall bill of materials (BoM) for smartphones is increasing, with prices for components such as storage modules and camera assemblies on the rise.
• Apple may see a price increase of at least 10% for the iPhone 18 Pro models due to the high cost of the 2nm processor.