Apple’s MacBook Neo upended the PC market in part because of a $599 starting price that put many comparable Windows laptops to shame, but it might have to give up that advantage.
Sources speaking to chip expert and Bloomberg alumnus Tim Culpan claim Apple is roughly doubling MacBook Neo production to 10 million due to hot demand, but that the higher costs associated with that move could lead it to drop the $599 model with 256GB of storage. You’d have to spend at least $699 for the 512GB version.
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We’ve asked Apple for comment and will let you know if we receive a response. In the company’s latest earnings call, departing CEO Tim Cook acknowledged Neo shortages and that the company had “under-called the level of enthusiasm” for its first budget laptop.
Why would Apple drop the $599 MacBook Neo?
Previously ‘free’ chips could soon cost money
Culpan explains the move as a byproduct of Apple’s successful strategy. It launched the MacBook Neo with binned versions of the A18 Pro chip that previously powered the iPhone 16 Pro — that is, chips with a defect (a malfunctioning GPU core) but otherwise usable. That effectively made them “free” and helped Apple reach the $599 price without compromising on quality or profit margins.
The higher-than-expected demand, however, is reportedly forcing Apple to order a new batch of chips from supplier TSMC to continue Neo sales. While this is apparently an urgent “hot lot” order that doesn’t carry stiff premiums, it could still be relatively expensive as Apple will face the combination of buying fresh (and in most cases fully functional) chips with higher RAM prices.
Cutting the $599 256GB model would let Apple absorb the higher costs without eating too much of its profits. There’s already precedence for this. Apple helped justify higher prices for the M5 MacBook Air and MacBook Pro by raising their respective starting storage levels to 512GB and 1TB, and it recently discontinued the entry M4 Mac mini (along with other mini and Studio configurations) to cope with higher component prices and sheer demand.
The alternative was to halt Neo sales entirely, according to Culpan. However, it’s not surprising that Apple moved forward. The Neo not only represents an opportunity to gain market share, but boost profits across its product line. Someone replacing a Windows PC with a Neo may be likely to buy not just more Apple hardware, but subscriptions for services like Apple Music and iCloud.
Is Apple losing its edge against Windows PCs?
Its advantages go beyond the starting price
Apple won’t necessarily lose ground to Windows PC rivals if it drops the $599 MacBook Neo configuration, The company doesn’t share unit sales, so it’s not clear how well the 256GB model is doing. The impact could be small if most customers are already buying the 512GB version.
The company is also counting on more than just a low price to spark interest. The Neo is better-built than much of its competition, with an aluminum body instead of plastic, a higher-resolution display, and better components like a click-anywhere trackpad. While some options might be faster or have more ports, Apple hopes design will help it stand out.
There’s also an ecosystem advantage. Apple routinely highlights how the MacBook Neo works well with iPhones, such as seamless messaging and AirDrop sharing. Although Windows PCs can sync with both iPhones and Android phones to some degree, Apple is betting that familiarity will help.
Crucially, Windows PC vendors aren’t immune to price changes, having raised the prices for memory upgrades and whole systems. The $699 Neo might still seem like a bargain if Acer, Dell, HP, and other brands are also forced to hike prices or eliminate models.
