Apple (AAPL) May Axe Cheapest MacBook Neo as TSMC (TSM) 3nm Costs Bite, Lifting Entry Price $100

Apple is evaluating the removal of the $599 256GB MacBook Neo, effectively raising the entry-level price to $699, as surging costs from TSMC’s 3-nanometer chip price hikes and rising memory prices erode margins, according to market reports on May 29, 2026. TSMC plans a 15% price increase on 3nm chips in the second half of 2026, followed by another 5% to 10% in 2027, as demand from AI infrastructure customers including Nvidia (NVDA), AMD (AMD), Google and AWS overwhelms capacity. Fab 18 output has been boosted to 160,000-175,000 wafers per month but remains insufficient. The MacBook Neo’s low pricing relied on using binned A18 Pro chips from iPhone 16 Pro production, but stronger-than-expected sales of 10 million units have depleted that discounted inventory. Apple must now order new, full chips at elevated TSMC pricing, wiping out the original cost advantage. Combined with higher DRAM costs, margins are nearing zero, prompting analyst Tim Culpan’s assessment that the company will cut the base model. Longer term, Apple is exploring outsourcing next-generation A27 chips to Intel (INTC) to diversify supply.