iPhone 18 Might Be More Expensive Due To Pricey A20 Chip

Over the past few years, Apple has done an impressive job of keeping iPhone pricing relatively steady. Despite increasingly advanced — and at times costlier — components, the price of an entry-level iPhone hasn’t changed at all in six years. This year’s entry-level iPhone 17 starts at $799, a price point which has been in place since 2020’s iPhone 12. Indeed, the only notable iPhone price increase in recent years has been the iPhone 17 Pro, which starts at $1,099 — about $100 more than previous iPhone Pro models.

With that said, a new report from the China Times relays that Apple’s 2026 iPhone lineup may be pricier across the board. The reason for the possible price hike is that the manufacturing process behind Apple’s upcoming A20 processor is markedly more expensive than previous A-series processors. This is due to the fact that the A20 is the first chip to feature TSMC’s 2 nm manufacturing process. As a result, the price of producing the A20 will reportedly be 50% higher than the A19.

While TSMC has traditionally offered Apple discounts due to the sheer volume of orders the iPhone maker places, the capital expenditure required to produce the A20 is sufficiently high that Apple might have to absorb the added cost and pass it along to consumers. It’s also possible that Apple may reserve chips manufactured with TSMC’s 2 nm process exclusively for its iPhone Pro models. This strategy would make sense, as it would help differentiate the iPhone 18 Pro from the entry-level model.

The advantage that comes with TSMC’s 2 nm process is that it allows for increased performance without sacrificing battery life. Indeed, TSMC has said that its 2 nm process can improve processing power by as much as 15% without any uptick in power consumption. And for use cases where processing power doesn’t need a boost, power usage can go down by as much as 30%. 

During a 2022 earnings conference call, a TSMC executive said the following: “After careful evaluation and extensive period of development, our 2-nanometer technology will adopt nanosheet transistor structure to provide our customers with best performance, cost and technology maturity. N2 deliver full node performance and power benefits to address the increasing need for energy-efficient computing, with 10 to 15 speed improvement at the same power or 20% to 30% power improvement at the same speed and logic density of more than 20% increase as compared with N3E.”

Apple will likely be the first company to incorporate TSMC’s 2 nm chips, something which the company will undoubtedly position as a huge selling point when its iPhone 18 lineup arrives next September.

Demand for Apple’s iPhone 17 has surpassed nearly all expectations, helping Apple’s stock price reach an all-time high earlier this week. Looking ahead, the momentum may not let up anytime soon. While nothing is ever certain until Apple makes an announcement, it’s starting to look like Apple’s 2026 iPhone lineup may be the company’s most exciting in years.

Aside from a more powerful A20 processor mentioned earlier, rumor has it that Apple next year will release a foldable iPhone. The device, when opened, will reportedly boast a 7.8-inch display and will look like two iPhone Air units glued together. Some rumors point to the device being just 4.5-4.8mm thick when fully open. As a point of comparison, the impressively svelte iPhone Air is just 5.6mm thick.

At this point, there’s no doubt Apple is working on a foldable iPhone, especially now that Samsung has demonstrated there’s a market for such a device. What remains uncertain is when a foldable iPhone might see the light of day. While many reports claim Apple is eyeing a 2026 launch, a recent report suggests that the device may be pushed back to 2027, as the company hasn’t yet finalized the design of key components.