Memory chip crunch to raise smartphone, PC costs next year
What's the story
The global tech industry is grappling with an unprecedented shortage of memory chips, the tiny components that store data in smartphones, laptops, tablets, and AI systems. According to research firm IDC, this crisis has reached its peak in late 2025 and could continue to affect the pricing and availability of popular electronic devices until 2027. The issue stems from chip makers prioritizing AI memory production over everyday devices.
Chip significance
Memory chips: The backbone of modern devices
Memory chips are vital for everything from running apps on smartphones to storing files on laptops. There are two main types of these chips: DRAM, which helps devices run programs, and NAND/SSD, which stores photos, videos, and files. Currently, demand for these chips far exceeds supply due to a rapid shift in the tech world toward AI memory production.
AI influence
AI's impact on memory chip production
The rapid growth of artificial intelligence (AI) has significantly impacted memory chip production. Major AI systems, especially those used by big cloud companies like Google, Microsoft, Meta, and Amazon, require massive amounts of memory to work properly. This demand has led major memory chip makers such as Samsung, SK Hynix, and Micron to shift their factories and resources toward producing memory for AI data centers where profits are higher.
Device impact
Impact on everyday devices and potential price increases
The shift in chip production has resulted in a tighter supply of general-purpose memory chips and much higher prices. This could have a noticeable impact on smartphones and laptops in 2026. Budget phones may no longer offer high-end memory features, which could push prices up or reduce choices for consumers. IDC warns that if the shortage continues through 2026, we could see fewer devices sold globally with average prices rising noticeably.
Market impact
PC market and future of tech prices
The personal computer market is also feeling the pinch of this global chip shortage. Many PC makers have already warned of price increases of up to 20% next year. IDC says that if the shortage continues, we could see a decline in smartphone sales with a modest increase in prices. For PCs, sales could shrink even more. This means consumers may have to pay more for new phones, laptops, or AI-ready devices in 2026 due to the ongoing chip crisis.