Smartphones and PCs may soon face a price hike as the rapid growth of artificial intelligence drives up the cost of crucial components like RAM and SSDs, with prices soaring by up to three times in recent months. The effects of this memory shortage are now beginning to impact the wider consumer electronics market.
Samsung Electronics and SK Hynix, major players in the memory market with over 70% share, have announced that their production capacity for the year is completely reserved. International Data Corporation (IDC) reports that the extraordinary shortage of memory chips might persist until at least 2027, driven by the ongoing demand from AI data centers surpassing supply.
In a new report, the Financial Times revealed that companies like Dell, Lenovo, Raspberry Pi, and Xiaomi are bracing for a price hike between 5% and 20%, all due to the ongoing chip shortage that's hitting the consumer electronics market hard. IDC has also suggested that the shortage of memory and storage could mark the end of an era where tech components were cheap and plentiful, at least for the near future.
Asus has recently declared that it will begin increasing the prices of various products starting January 5. Meanwhile, Dell is also said to be planning price hikes ranging from $55 to $765 for its premium memory products. In contrast, major tech companies such as Apple and Samsung might be less affected by these increases due to their long-term supply contracts.
Peter Lee, an analyst at Citigroup, states that the demand for AI data centers is significantly higher than expected and that "supply will remain tight until 2027, with no additional capacity expected."