When the chief executives of two of the most valuable companies on earth independently use the same language to describe what they are seeing in the economy, it is worth more than a passing scroll.
That is what happened over the summer, and the warning has only grown louder since.
Tim Cook, who spent 15 years running Apple before stepping back this fall, and Elon Musk, who leads Tesla and the newly public SpaceX, rarely agree on much in public.
This time their assessments lined up almost word for word, and the numbers behind their comments back up the alarm.
Tim Cook’s Hundred-Year flood warning
Cook, still Apple’s chief executive at the time, told The Wall Street Journal in a June interview that the surge in memory and storage chip costs was unlike anything he had encountered in decades.
“This is a hundred-year flood,” Cook said. “I’ve never seen anything like it in any area in over 40 years,” according to TheStreet.
The warning came as Apple prepared to raise prices across its lineup to offset soaring costs for the chips used in iPhones, Macs and iPads.
Cook said the situation had become unsustainable despite Apple’s efforts to shield customers from the increases. “Unfortunately, price increases are unavoidable,” he said.
More Elon Musk:
- Elon Musk makes bizarre claims about money, future of AI
- Elon Musk sends blunt verdict on the future of humanity and AI
- Elon Musk’s startling claim to SpaceX investors
The root cause is an unprecedented scramble for memory chips driven by AI data centers. ABC News reported that Cook attributed the shortage directly to AI companies’ appetite for the same components Apple needs for consumer devices.
Cook told the Journal that Apple would use its balance sheet to help fund additional memory supply, though it has no plans to build its own chip factories.
Apple’s former CEO made the comments months before handing the chief executive role to John Ternus, Apple’s longtime hardware engineering chief, who officially took over on September 1.
Cook has since moved into the role of executive chairman, making the hundred-year flood comment one of his final statements as the company’s top executive.
Musk backs the warning, and the data confirms it
Musk did not wait long to weigh in. He quoted Cook’s Wall Street Journal comments directly on X and added his own take.
“Biggest price jump in anything I’ve ever seen too,” as reported by Yahoo Finance.
Coming from someone who has run car and rocket manufacturing through years of supply chain turmoil, the comment carried weight.
Musk also shared a Wall Street Journal article titled “The Data-Center Boom Is Sparking a Third Wave of Inflation,” arguing that America’s AI buildout is pushing up prices on everything from smartphones to electricity. One chart in that piece showed consumer prices for computer software and accessories had climbed roughly 15% from a year earlier.
The underlying numbers support both executives’ alarm. Memory and storage chip prices have quadrupled over the past three quarters, as booming AI-server demand absorbs supply and manufacturers prioritize high-bandwidth memory used in AI servers rather than consumer electronics.
That shift has been extraordinarily profitable for chipmakers even as it squeezes device makers. Micron reported gross margins of 84.9% in its most recent quarter, up from 39% a year earlier, outpacing even Nvidia and Meta. The imbalance between soaring chip profits and squeezed device margins is adding pressure on Apple and its rivals toward price hikes.
Other companies are already raising prices
Apple did not wait long to act on Cook’s warning. The company announced price hikes across its MacBook and iPad lineup, its first formal move to pass higher memory and storage costs on to consumers. Increases ranged from $100 to $300, and Apple said it had never seen a component price increase this large or this fast.
Apple is not alone. Other major device makers, including Hewlett-Packard, Dell and Nintendo, have already raised prices, underscoring that the memory squeeze is an industrywide problem, not an Apple-specific one.
Consumers may feel the pinch most with Apple’s next iPhone generation.
A research firm estimated the cost of the upcoming iPhone Pro would rise by more than $200, pushing the device toward roughly $1,299. Apple had not confirmed final pricing as of then, and Cook himself declined to say when increases would hit or which products would be affected.
TheStreet’s coverage of the episode framed it plainly. A week before Apple raised Mac and iPad prices by hundreds of dollars, Cook’s Wall Street Journal comments stopped people mid-scroll, and Musk’s agreement turned the moment into a broader conversation about where AI-driven inflation goes next.
What this means for investors
The deeper message for investors is not really about iPhones or laptops. It is about how AI infrastructure spending is starting to bleed into everyday consumer prices in ways headline inflation figures do not always capture right away.
Musk and Cook are strong tech veterans who have lived through shortages, cost spikes and shipping chaos before, and neither of them has used language that is this stark and casual.
That risk is compounding alongside separate pressure from the Middle East. An ongoing conflict has kept energy prices elevated. BlackRock has estimated the conflict could add roughly 0.8 percentage points to global headline inflation, with Europe and parts of Asia more exposed, given that they rely heavily on energy imports.
None of this means a return to 2022-style inflation is guaranteed, but it does suggest investors should watch component costs, device pricing and energy markets together rather than separately.
When the executives behind two of the most sophisticated supply chains in the world compare what they are seeing to a hundred-year flood, it is worth taking seriously rather than dismissing as routine corporate complaining.
Related: Jim Cramer doubles down on Tim Cook and Apple verdict