Apple killed off the baseline Mac Mini, raising the entry price of its cheapest desktop from $599 to $799. Could it pull a similar move with its cheapest laptop?
In his Culpium newsletter, Tim Culpan reports that Apple is preparing a new production run of the MacBook Neo, upping the number of units to 10 million from its initial run estimated to be between 5 and 6 million. Having exhausted its supply of A18 Pro processors leftover from the iPhone 16 Pro, Apple will need to manufacture a fresh batch of A18 Pro chips for these new Neos.
The cost of producing new chips instead of simply dipping into an existing supply of “binned” parts will cut into the Neo’s profit margins. Faced with slimmer margins, Apple could stop selling the $599 model, says Culpan, and position the $699 MacBook Neo as the entry point.
Neo recap
Let’s back up and recap the situation that Apple finds itself in with the MacBook Neo.
The MacBook Neo is released in March and becomes an instant hit. “We were very bullish on the product before announcing it, but we under-called the level of enthusiasm that would be with it,” CEO Tim Cook said last week in Apple’s Q2 earnings call.
With the Neo flying off store shelves, Apple is running through its supply of Neos faster than it anticipated. With next year’s update too far away to meet Neo demand, it needs to make more of the current model. And this requires Apple to spend money to make millions of A18 Pro chips, a cost it didn’t incur for the initial supply of Neos.
At the heart of the MacBook Neo are binned versions of the A18 Pro chip that Apple made for the iPhone 16 Pro. These binned chips have a slight manufacturing defect in one of their six integrated graphics cores and weren’t used in the iPhone 16 Pro. (That’s why the MacBook Neo is listed as having five GPU cores, while the iPhone 16 Pro has six.)
Faced with increased manufacturing costs for this second run of Neos, Apple might not like the math it sees for the baseline $599 model that students can scoop up for $499 with Apple’s education discount — especially when you also factor in the rising costs of computer memory and storage.
Bye-bye $599 Neo?
One move available to Apple, which it already made with the Mac Mini, is to remove the lowest-cost 256GB model that has the lowest margins. Such a maneuver with the Neo would leave the $699 model with a 512GB SSD and Touch ID as the only option (unless Apple, say, added a 1TB model above it).
And before you start thinking about waiting for a MacBook Neo with a fresh A18 Pro chip that might offer a slight bump in graphics performance, Apple isn’t likely to offer it with six functional GPUs. To keep things even, Apple will probably switch off one of the GPUs so a Neo purchased today or later this year will have the same 6-core CPU and 5-core GPU.
One item that you might be willing to wait for: new colors. Culpan supposes that Apple could introduce new color options for the Neo in an effort to soothe any hurt feelings about it raising the cost of Neo entry.
I’m already on record as saying that students should view Apple’s $100 discount as a free upgrade for Touch ID and double the storage, so I wouldn’t be too upset to see the end of the $599 Neo with its meager amount of storage and no Touch ID. But I’m sure there are many students and educators that would bemoan its demise, new colors or no.
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