Apple, once one of the most powerful buyers in the NAND flash market, is losing some of its negotiating leverage as AI-driven demand gives memory suppliers greater pricing power, notes TrendForce.
According to The Wall Street Journal, the tech giant reportedly pressured flash manufacturers for years to disclose detailed financial and operational information, allowing it to monitor pricing and ensure no other customers secured better deals.
The aggressive tactics reportedly left a lasting impression on suppliers. One Kioxia sales executive was so frustrated with Apple’s negotiating practices that he once took a rifle and shot his old iPod, the WSJ adds.
From the report:
° One of Apple’s tactics was to exploit falling flash prices to secure further concessions.
° Apple also reportedly required flash suppliers to designate it as a “most favored customer,” ensuring that no other buyer received a lower price.
The WSJ says the pressure sometimes turned confrontational. In late 2015, SanDisk refused Apple’s requests for additional flash supply because other customers were willing to pay more. According to the report, Apple’s then-procurement chief Tony Blevins threatened retaliation against a SanDisk salesperson, saying he would make the company’s then-CEO, Sanjay Mehrotra, “crawl on his knees.” Mehrotra is now chairman and CEO of Micron Technology.
Apple itself is reportedly adjusting its procurement strategy amid rising costs. South Korean media outlet Economy Tribune says the tech giant has reportedly turned to a long-term NAND supply agreement, with market watchers identifying Kioxia as the likely partner. While the terms remain undisclosed, the move could mark a departure from Apple’s historically aggressive purchasing practices. The report adds that Apple may also pursue long-term agreements with Samsung Electronics, SK hynix, and Micron to secure future LPDDR5X and LPDDR6 supplies.
The cost pressure is becoming increasingly evident. According to TrendForce, memory’s share of the 256GB iPhone Pro’s bill of materials rose from around 10% a year earlier to 34% in the third quarter of 2026 and could exceed 40% in the first half of 2027. TrendForce also estimates that the iPhone 18 Pro’s total BOM (bill of materials) cost could rise 38% year-over-year, potentially forcing Apple to sacrifice margins to maintain shipments.
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Article provided with permission from AppleWorld.Today