AI Memory Shortage Drives Surge in Prices
In 2026, the global market for memory, especially RAM, is facing an unprecedented shortage due to soaring demand from the artificial intelligence sector. Companies such as Nvidia, Advanced Micro Devices (AMD), and Google are prioritizing their need for RAM for their cutting-edge AI chips, causing a significant strain on availability.
Surge in Demand and Market Response
Industry leaders Micron, SK Hynix, and Samsung Electronics dominate the memory market, and they are reaping the benefits of the current demand surge. Micron’s business chief Sumit Sadana highlighted this at the CES trade show in Las Vegas, noting that demand has significantly outpaced supply capabilities. Notably, Micron’s stock has surged by 247% in the past year, and the company’s net income nearly tripled in its most recent quarter. Similarly, Samsung anticipates its operating profit for December to nearly triple, with SK Hynix also seeing a rise in stock value.
Unprecedented Price Increases
According to TrendForce, a Taipei-based market researcher, average DRAM memory prices are predicted to rise between 50% and 55% for the first quarter of 2026, a rate described by analyst Tom Hsu as “unprecedented.” With Nvidia’s latest Rubin GPU featuring up to 288 gigabytes of next-generation high-bandwidth memory (HBM4), competition for these specialized components is fierce. This HBM memory, crucial for high-bandwidth requirements of AI applications, is produced through complex stacking processes that render standard memory less available.
Implications for the Consumer Market
This increase in HBM demand is causing a ripple effect in the consumer market. Major consumer electronics companies like Apple and Dell are bracing for potential price hikes or reduced margins. Currently, RAM constitutes about 20% of hardware costs in laptops, up from the previous range of 10% to 18% in early 2025. As Micron shifts focus to fulfilling AI demands, it has discontinued some consumer-oriented memory products, leading industry insiders to speculate about impending price increases.
The Memory Wall Dilemma
Industry experts, including Sha Rabii from Majestic Labs, have identified a critical bottleneck referred to as the “memory wall,” where powerful AI chips cannot keep pace with memory advancements. While AI processing units are becoming faster, memory technology is lagging considerably, hindering performance. Rabii emphasized that additional memory is essential for running expansive models and accommodating more users, which is a direct response to the rising appetite for AI functionalities.
Future Outlook and Production Challenges
The shortage has forced companies like Micron to contemplate new production facilities, with plans for two new fabs in Boise slated to begin output in 2027 and 2028, and another in Clay, New York projected for 2030. However, given the current backdrop, Micron’s Sadana confirmed that they are already “sold out for 2026.”
As companies grapple with this memory shortage, the situation is poised to challenge pricing and availability across consumer electronics. With ongoing investments in memory production, the expectation is that, although improvement is on the horizon, the immediate effects of the AI memory demand will continue to shape market dynamics into the foreseeable future.