Memory-chip shortages driven by AI demand to push smartphone prices higher in 2026

Industry analysts warn that surging AI-driven memory chip demand, combined with supply constraints, could lead to significant price increases in smartphones by 2026, affecting consumers and manufacturers alike.

Memory-chip shortages driven by surging AI demand are set to push smartphone prices higher in 2026, industry analysts and market data show. According to the original report, a tight supply of legacy LPDDR4 and rising contract prices for DRAM and NAND Flash , as major suppliers shift production to high‑margin AI server components , could add roughly 8–10% to smartphone bill‑of‑materials costs and lift average selling prices across the market. [^[1]^](https://www.gizguide.com/2025/12/smartphone-2026-prices-to-increase.html)[^[5]^](https://www.reuters.com/business/media-telecom/idc-sees-global-smartphone-shipments-dipping-in-2026-memory-costs-bite-2025-12-02/)[^[6]^](https://www.business-standard.com/industry/news/memory-chip-prices-soaring-impact-smartphone-prices-2026-125120500146_1.html)

Counterpoint Research and other analysts warn the pain is concentrated in slower, mainstream memory nodes. Counterpoint says memory prices may rise about 30% in Q4 2025 and another 20% in early 2026 on top of roughly 50% increases already recorded this year, a dynamic that will disproportionately affect low‑ and mid‑range devices where memory is a larger share of cost. Industry data shows Samsung and Micron have reallocated capacity toward advanced server parts to supply hyperscalers, tightening availability for mobile‑grade chips. [^[1]^](https://www.gizguide.com/2025/12/smartphone-2026-prices-to-increase.html)[^[6]^](https://www.business-standard.com/industry/news/memory-chip-prices-soaring-impact-smartphone-prices-2026-125120500146_1.html)[^[3]^](https://www.tomsguide.com/computing/ram-prices-are-exploding-heres-why-and-everything-you-need-to-know-about-surviving-ramageddon)

The squeeze is not limited to DRAM. Reports from SSD and memory makers describe simultaneous NAND Flash shortages and steep spot‑price jumps, forcing manufacturers that service consumers to take drastic steps. A Taiwanese supplier told industry media that NAND allocations were delayed and costs jumped sharply as cloud customers prioritised shipments; that disruption has already driven price adjustments and product delistings in the broader hardware channel. The result: higher costs for components that underpin smartphones, tablets and storage‑heavy models. [^[2]^](https://www.pcgamer.com/hardware/storage/just-last-week-alone-we-were-notified-that-costs-had-risen-by-50-100-percent-ssd-maker-transcend-further-tightens-its-belt-amid-delayed-samsung-and-sandisk-shipments/)[^[3]^](https://www.tomsguide.com/computing/ram-prices-are-exploding-heres-why-and-everything-you-need-to-know-about-surviving-ramageddon)

Major memory producers have been passing increases through to customers for server modules, a move with knock‑on effects for consumer electronics. Samsung has raised server chip prices substantially, and OEMs face the choice of absorbing margin declines or passing costs to buyers. Analysers at TrendForce estimate memory price inflation could raise smartphone manufacturing costs by up to 15% in some mid‑to‑high‑end models, while other forecasting firms put likely retail price inflation for phones in the single‑digit percentage range. [^[1]^](https://www.gizguide.com/2025/12/smartphone-2026-prices-to-increase.html)[^[4]^](https://www.tomshardware.com/tech-industry/dell-and-lenovo-set-to-increase-server-and-pc-costs-by-as-much-as-15-percent-as-soon-as-this-month-according-to-industry-sources-dram-and-ai-demand-create-tight-market-for-businesses-and-consumers)

Market forecasters expect these supply pressures to reshape shipment and revenue trajectories in 2026. IDC forecasts a 0.9% decline in global smartphone shipments next year , the first drop since 2020 , even as average selling prices (ASPs) are projected to climb to about USD 465, lifting total market value to an all‑time high. Reuters reporting based on IDC notes Apple’s strong 2025 iPhone performance helped buoy the market this year, but delayed lower‑end device refreshes and memory cost inflation will hit volumes, especially among low‑ and mid‑tier Android models. Vendors are likely to tilt product mixes toward higher‑margin models or increase prices to offset elevated component costs. [^[5]^](https://www.reuters.com/business/media-telecom/idc-sees-global-smartphone-shipments-dipping-in-2026-memory-costs-bite-2025-12-02/)[^[1]^](https://www.gizguide.com/2025/12/smartphone-2026-prices-to-increase.html)

The impact is already visible in supplier and OEM behaviour. PC and server vendors are implementing price changes and urging customers to lock in orders; some consumer brands in markets such as India have already raised prices on existing models. Analysts caution the shortage could persist into 2026 and beyond until new wafer fabs and capacity additions come online , a multi‑year process , or until a meaningful rebalancing of AI demand occurs. Two broad outcomes are possible: sustained elevated prices as manufacturers prioritise AI customers and expand capacity, or a future correction if demand for AI memory softens. [^[4]^](https://www.tomshardware.com/tech-industry/dell-and-lenovo-set-to-increase-server-and-pc-costs-by-as-much-as-15-percent-as-soon-as-this-month-according-to-industry-sources-dram-and-ai-demand-create-tight-market-for-businesses-and-consumers)[^[2]^](https://www.pcgamer.com/hardware/storage/just-last-week-alone-we-were-notified-that-costs-had-risen-by-50-100-percent-ssd-maker-transcend-further-tightens-its-belt-amid-delayed-samsung-and-sandisk-shipments/)[^[6]^](https://www.business-standard.com/industry/news/memory-chip-prices-soaring-impact-smartphone-prices-2026-125120500146_1.html)[^[3]^](https://www.tomsguide.com/computing/ram-prices-are-exploding-heres-why-and-everything-you-need-to-know-about-surviving-ramageddon)

For consumers, the near‑term outlook is clear: expect higher device prices and tighter availability on certain configurations, particularly bigger storage and mainstream DRAM options. According to the original report, smartphone makers will need to decide whether to accept narrower margins, reduce features, or pass costs to buyers , and market dynamics over the next 12–24 months will determine which path predominates. [^[1]^](https://www.gizguide.com/2025/12/smartphone-2026-prices-to-increase.html)[^[6]^](https://www.business-standard.com/industry/news/memory-chip-prices-soaring-impact-smartphone-prices-2026-125120500146_1.html)[^[5]^](https://www.reuters.com/business/media-telecom/idc-sees-global-smartphone-shipments-dipping-in-2026-memory-costs-bite-2025-12-02/)

📌 Reference Map:

##Reference Map:

• [^[1]^](https://www.gizguide.com/2025/12/smartphone-2026-prices-to-increase.html) (GizGuide) – Paragraph 1, Paragraph 2, Paragraph 5, Paragraph 7
• [^[2]^](https://www.pcgamer.com/hardware/storage/just-last-week-alone-we-were-notified-that-costs-had-risen-by-50-100-percent-ssd-maker-transcend-further-tightens-its-belt-amid-delayed-samsung-and-sandisk-shipments/) (PC Gamer) – Paragraph 3, Paragraph 6
• [^[3]^](https://www.tomsguide.com/computing/ram-prices-are-exploding-heres-why-and-everything-you-need-to-know-about-surviving-ramageddon) (Tom’s Guide) – Paragraph 2, Paragraph 3, Paragraph 6
• [^[4]^](https://www.tomshardware.com/tech-industry/dell-and-lenovo-set-to-increase-server-and-pc-costs-by-as-much-as-15-percent-as-soon-as-this-month-according-to-industry-sources-dram-and-ai-demand-create-tight-market-for-businesses-and-consumers) (Tom’s Hardware) – Paragraph 4, Paragraph 6
• [^[5]^](https://www.reuters.com/business/media-telecom/idc-sees-global-smartphone-shipments-dipping-in-2026-memory-costs-bite-2025-12-02/) (Reuters/IDC) – Paragraph 1, Paragraph 5, Paragraph 7
• [^[6]^](https://www.business-standard.com/industry/news/memory-chip-prices-soaring-impact-smartphone-prices-2026-125120500146_1.html) (Business Standard/Economic Times) – Paragraph 2, Paragraph 5, Paragraph 7

Source: Fuse Wire Services