$Apple(AAPL.US) encounters a difficult question and goes silent again. Apple is really in a tough spot this time. Falling behind in AI large models is one thing; the strategy of maintaining cash flow and integrating whichever model is best, while holding onto its position as the global leader in consumer electronics terminals to secure steady profits, is viable. However, the unresolved issue of memory price hikes creates another unwinnable situation. If Apple doesn't raise phone prices but absorbs the full cost of the memory price increases, then starting next quarter, the company's financial report will begin to show a decline in gross margin.

If Apple passes on the memory price hikes to consumers by doubling the phone price increase—where the price difference for upgrading from 256GB to 512GB was originally 2000 RMB, and upgrading from 512GB to 1TB is even more expensive—and does this on top of Apple's already sky-high memory prices, then in today's tough economic climate where people are already cutting back on spending, expecting consumers to pay even more for the new iPhone is nearly impossible. The iPhone 18 is unlikely to sell out like the 17 did. Moreover, smartphone performance has long been overkill and doesn't lag, so people will just keep using their current phones for another year or two to ride out this period. Therefore, sales in mainland China are bound to plummet sharply. Since we are a major part of Apple's revenue, Apple's financial performance will still decline next quarter, already signaling an unwinnable situation. Hoping for Apple's stock price to continue hitting new highs and surge is almost impossible. Whether it will fall depends on the situation... looking at CXMT's supply and AI phones, relying solely on the iPhone 18's foldable screen as a selling point is difficult.

The only way out, which Apple is also pursuing, is to hope the US government approves Apple's procurement of chips from our CXMT. Although CXMT has also raised prices significantly, it's much more acceptable compared to the three major memory manufacturers. Furthermore, amidst this massive wave of memory price hikes, this move might even help Apple encroach on competitors and solidify its leading position in consumer electronics. However, pulling this off is quite challenging.

Honestly, after profiting from consumer electronics for so many years and sitting on such massive cash reserves, Apple is neither investing heavily in AI nor, like Jensen Huang, constantly visiting memory fabs to lock in, secure, and expand capacity. Instead, it seems content to watch from the sidelines as other major tech companies engage in massive spending battles, hoping to reap the benefits later with a second-mover advantage once someone else succeeds. Now, getting caught off guard by a single memory price hike? Don't even think about staying out of the fray. What's more, the upcoming wave of AI infrastructure development might bring other troubles for Apple. What's the point in solely blaming Micron for the price hikes? Memory prices are determined by market supply and demand. Data centers need it too. Memory isn't sold at a constant gold-plated price like in your home; memory manufacturers were losing money every day before...

In the end, all consumption is paid for by Apple consumers. Let the consumers suffer a bit more, and let the infamy be borne by the 'little cabinet elder' because he's carrying the burden of the two capitals and thirteen provinces on his shoulders. 😂

$Apple(AAPL.US)$Micron Tech(MU.US)