Apple little changed in after-hours trading amid margin compression fears from surging memory costs

Apple shares continued their two-day slide, closing down 0.77% on January 7, driven by concerns that soaring memory component costs will erode profit margins ahead of their January 29 earnings report.

• Rising AI hardware demand is projected to increase DRAM prices by 40-70% and NAND by 30% in Q1 2026, potentially causing a 160-basis-point gross margin hit as Apple absorbs costs to maintain iPhone pricing.
• On January 7, Alphabet briefly surpassed Apple in market capitalization, reflecting investor rotation toward AI software amid valuation concerns over Apple's 33x forward P/E.
• The stock closed the day at $260.33 and traded slightly higher after hours at $260.51 (+0.07%).