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2025–present global memory supply shortage

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2025–present global memory supply shortage
Average retail price of DDR5-5200 16 GB × 2 RAM kits between July 2024 and December 2025[1]
Date2025–present
Location
  • Global
Cause
Outcome200–400% price increases in DRAM and NAND flash,
OpenAI consumes ~40% of global DRAM supply,
15–20% cost increases for PC OEMs

A global computer memory supply shortage started in 2025 due to supply constraints and rapid price escalation in the semiconductor memory market, particularly affecting DRAM and NAND flash integrated circuits. This shortage has been referred to in media outlets as "RAMmageddon"[2] or the "RAMpocalypse".[3] Unlike the 2020–2023 global chip shortage, which stemmed primarily from pandemic-related supply chain disruptions from COVID-19, this shortage is driven by the intentional reallocation of manufacturing capacity toward highly profitable products intended for AI data center development[4], creating a scarcity of integrated circuits intended for the consumer and enterprise markets.[5][6] According to a 2026 Kearney's PERLab analysis, the shortage is expected to last at least until 2030.[7] In June 2026, Micron Technology CEO Sanjay Mehrotra expected the shortage to last through 2027, and supply to gradually improve by 2028.[8]

Background

[edit]

Following a severe market downturn during 2022–2023, major memory manufacturers—Samsung Electronics, SK Hynix, and Micron Technology—implemented strategic production cuts to stabilize pricing.[9] By mid-2024, the rapid expansion of generative AI services triggered unprecedented demand for specialized memory products, particularly High Bandwidth Memory (HBM) used in AI accelerators and data center GPUs.[10][11][12] Specialized components of semiconductor technology are also experiencing supply constraints due to high demand in AI application. For example, glass cloth, a high-performance glass fiber substrate used for power efficient high speed data transfer and a crucial component of semiconductor manufacturing, is experiencing a supply crisis. Nitto Boseki, a Japanese firm having overwhelming monopoly in its production, is not able to meet increased demands, making chip-makers such as Qualcomm, Apple, Nvidia, and AMD compete for securing supply.[13][14] There are also reports of smaller electronics companies struggling to find suppliers for components such as NAND flash. Memory suppliers are adapting to increased demands and market unpredictability by requiring prepayment or shorter time-frame of payment, which makes it more difficult for smaller firms to acquire capital to survive.[15][16] By 2026, due to steadily increased demand on resources, CPUs are also experiencing shortage issues due to low fabrication capacity, prioritization of server CPUs, and increased demand, with CPU prices also being forecast to increase by as much as 15%.[17][18]

The demand on memory has also increased strain on other electronic components such as hard disk devices, with reports such as Western Digital's hard disk supply for 2026 being booked for enterprise applications before February 2026.[19]

A 2024 McKinsey analysis projected that global demand for AI-ready data center capacity would grow at approximately 33% annually through 2030, with AI workloads consuming roughly 70% of total data center capacity by the decade's end.[20] In addition, according to Kearney's State of Semiconductor 2025 Report, executives were already expecting a shortage in the sub–8 nm wafer size with memory chips being mentioned as an acute source of concern. Multiple companies mentioned being prepared for it through long-term agreements with RAM suppliers or amassing additional inventory.[21]

On March 24 2026, Google announced TurboQuant,[22] a memory compression technology focused on large language models (LLM) and vector search engines, which it claimed achieves 6 times lower memory consumption in tested local LLMs, and 8-fold performance enhancement in tests running on H100 accelerators. The technology is also a drop in enhancement for existing inference pipeline. Amid speculation about memory demand trends, memory manufacturers, Sandisk, Micron, Western Digital, and Seagate, among other companies involved in memory manufacture experienced stock price declines.[23][24] Prices of memory kits also reduced in the following months, although still at inflated prices.[25]

Development

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On July 8 2026, Micron announced it had broken ground on a new $9.3 billion fab for memory production.[26] It is expected to start production in Q3 2028.

Causes

[edit]

HBM production displacement

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HBM manufacturing requires significantly more wafer capacity per bit than standard DRAM modules. Industry sources reported that as manufacturers allocated increasing wafer capacity to HBM production to meet contracts with AI infrastructure providers, the supply of conventional DDR4 and DDR5 modules for consumer PCs and smartphones contracted sharply.[5][27]

By September 2025, Samsung Electronics had reportedly expanded its 1c DRAM capacity to target 60,000 wafers per month specifically for HBM4 production, further diverting resources from consumer memory lines.[28]

Geopolitical and trade barriers

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The supply chain was further constrained by escalating trade tensions between the United States and China. Throughout 2025, fears of U.S. regulatory backlash and new tariff structures led major manufacturers like Samsung and SK Hynix to halt sales of older semiconductor manufacturing equipment to Chinese entities, effectively capping production capacity in the region.[29] Additionally, proposed tariff policies by the U.S. administration in late 2025 prompted supply chain realignments, with Apple reportedly accelerating plans to source all U.S.-bound iPhones from India to avoid potential levies.[30]

NAND flash capacity constraints

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In the NAND flash segment, manufacturers prioritized higher-margin enterprise SSDs for data center applications while phasing out older process nodes more rapidly than anticipated. In November 2025, contract prices for NAND wafers increased by more than 60% month-over-month for certain product categories, with 512 GB TLC experiencing the steepest rise as legacy manufacturing capacity was retired.[31]

Impact on other industries

[edit]

Memory manufacturer responses

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Samsung is concerned about the possibility of a demand shortfall by 2028.[32][33] Chey Tae-won, CEO of SK Hynix, estimated the memory shortage will last until 2030.[34] Kye-hyun Kyung, advisor to Samsung and former head of Samsung's chip group, believed memory prices could drop in a year.[35]

PC manufacturers

[edit]

Major PC manufacturers responded to component cost increases with significant price adjustments and supply chain strategies. Dell Technologies Chief Operating Officer Jeff Clarke stated during a November 2025 analyst call that the company had "never witnessed costs escalating at the current pace", describing tighter availability across DRAM, hard drives, and NAND flash memory.[36][37]

Analysts at Morgan Stanley downgraded Dell Technologies stock from "Overweight" to "Underweight" in late 2025, citing the company's heavy exposure to rising server memory costs. The firm warned that skyrocketing memory prices could significantly erode margins for server and PC OEMs.[38] Conversely, Apple Inc. was reportedly less affected than its competitors, having secured long-term supply agreements for DRAM through the first quarter of 2026.[38] However, on June 25, 2026, Apple announced price hikes effective immediately on all iPads, Macs, HomePods, Apple Vision Pro, and Apple TV, causing Apple shares to decline by more than 6%, the worst day for the stock since the April 2025 stock market crash.[39][40]

Lenovo Chief Financial Officer Winston Cheng described the cost surge as "unprecedented" and disclosed that the company's memory inventories were approximately 50% above normal levels in anticipation of further price increases.[36][37]

Consumer electronics sector

[edit]

The shortage particularly affected smartphone manufacturers and other consumer electronics producers. DRAM prices reportedly rose by 172% throughout 2025, leading manufacturers like Samsung to halt new orders for DDR5 modules to reassess pricing structures and Micron to exit its 'Crucial' brand of consumer products.[41][42]

In Tokyo's Akihabara electronics district, retailers began limiting purchases of memory products to prevent hoarding, with prices for popular DDR5 memory modules more than doubling in some cases.[6] Despite the broad trend of rising hardware costs, some companies engaged in aggressive pricing strategies to maintain market share; for example, Sony reduced the price of the PlayStation 5 by US$100 for Black Friday 2025, potentially absorbing increased component costs to stimulate software ecosystem growth.[43]

Due to memory prices more than doubling in a single quarter, HP revealed in its Q1 2026 earnings call that memory costs accounted for 35% of PC build materials up from 15–18% previous quarter. Despite showing strong Q1 2026 earnings driven by Windows 11 upgrade cycle and AI PC adoption, HP warned investors of low operating margins and up to double digit percentage decline for the coming quarter.[44] Trendforce, an IT analytics company, updated its forecast from 1.7% year-over-year growth in PC market to 2.6% year-over-year decline for 2026, amid backdrop of steadily increasing prices and supply crisis.[45] Research and analytics firms, Gartner and IDC, expected the worldwide PC market to decline 10–11%, and the smartphone market to decline 8–9% in 2026.[46] Gartner also projected that rising memory prices would make low-margin entry level laptops under US$500 financially unviable in two years.[47]

The RAM shortage has delayed the release of Valve's second Steam Machine due to increased memory prices. The device was originally set to launch in early 2026.[48][49]

AI infrastructure competition

[edit]

Technology companies including Google, Amazon, Microsoft, and Meta Platforms placed open-ended orders with memory suppliers, indicating they would accept as much supply as available regardless of cost, according to Reuters sources.[6]

The limited supply of AI chips has been cited as a reason for the slow down in compute growth.[50]

In October 2025, OpenAI formally announced a strategic partnership using letters of intent with Samsung Electronics and SK Hynix to secure supply for its Stargate Project AI infrastructure.[51] Reports indicated that the Stargate initiative alone would consume up to 40% of global DRAM output, requiring approximately 900,000 wafers per month.[52][53] The deal involved the supply of undiced wafers rather than packaged chips to streamline logistics for the massive data center build-out.

Nvidia, whose AI processors require substantial amounts of high-bandwidth memory, acknowledged significant price increases but stated it had secured adequate supply.[6] CNBC reported that Nvidia's increasing adoption of LPDDR memory for its AI products added additional pressure to supply chains, as this memory type is also used in premium consumer electronics.[54]

[edit]

Samsung, SK Hynix, and Micron—the 3 largest manufacturers of DRAM—were sued in an antitrust class-action lawsuit over potentially taking advantage of the supply shortage by price-fixing.[55] The complaint alleges that the three companies engaged in a conspiracy to manipulate the commodity DRAM market through price-fixing and artificial supply constraints. Plaintiffs assert that the manufacturers used the transition to HBM as a pretext to simultaneously cut production of conventional DRAM and exit legacy product lines like DDR3.[56]

See also

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References

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  1. ↑ "Memory Price Trends – DDR5-5200 2×16 GB". PCPartPicker. Retrieved December 21, 2025.
  2. ↑ Harper, Chris (December 11, 2025). "RAMmageddon Memory Crisis May Hit PC And Phone Specs Hard". Hot Hardware. Retrieved February 6, 2026.
  3. ↑ Pier, Sebastian (January 27, 2026). "The RAMpocalypse won't end until late 2027, and there could be an SSD apocalypse, too". Phone Arena. Retrieved February 5, 2026.
  4. ↑ "Industry Coalition Letter re: Memory Shortage" (PDF). NCTA. June 3, 2026.
  5. 1 2 Alcorn, Paul (November 30, 2025). "The RAM pricing crisis has only just started, Team Group GM warns, says problem will get worse in 2026 as DRAM and NAND prices double in one month". Tom's Hardware. Retrieved December 16, 2025.
  6. 1 2 3 4 "The AI frenzy is driving a memory chip supply crisis". Reuters. December 3, 2025. Retrieved December 20, 2025.
  7. ↑ Harper, Chris (May 7, 2026). "The great memory reallocation". Kearney. Retrieved May 7, 2026.
  8. ↑ Moore, Bo (June 24, 2026). "Micron CEO Expects RAM Shortage to Last Through 2027, Start to Ease in 2028". IGN. Retrieved June 24, 2026.
  9. ↑ "Micron Technology, Inc. Reports Results for the Fourth Quarter and Full Year Fiscal 2025". Micron Technology (Press release). September 22, 2025. Retrieved December 16, 2025.
  10. ↑ White, Monica J. (December 1, 2025). "It's not just RAM—SSDs could soon cost way more too, and it's all downhill from here". PC Gamer. Archived from the original on December 1, 2025.
  11. ↑ Kask, Kristian (December 2, 2025). "AI-driven RAM shortage hits Raspberry Pi: Price hikes and a new budget model". PCWorld. Retrieved May 23, 2026.
  12. ↑ Hollister, Sean (November 24, 2025). "RAM prices are so out of control that stores are selling it like lobster". The Verge. Archived from the original on November 26, 2025. Retrieved May 23, 2026.
  13. ↑ Cross, Jason (January 14, 2026). "An obscure material used in every Apple device is suddenly in very short supply". Macworld. Retrieved January 20, 2026.
  14. ↑ Bakolia, Ravikash (January 14, 2026). "Apple, Qualcomm face supply woes over Japan's glass cloth: report". Seeking Alpha. Retrieved May 23, 2026.
  15. ↑ James, Luke (March 3, 2026). "AI memory crunch forces DRAM market into 'hourly pricing' model, report claims — small and medium-sized businesses fighting for survival". Tom's Hardware. Retrieved March 11, 2026.
  16. ↑ Ferreira, Bruno (February 18, 2026). "Phison CEO thinks NAND shortages could shut down entire consumer electronics companies in 2026 — claims at least one foundry demands three-year cash payment upfront". Tom's Hardware. Retrieved March 11, 2026.
  17. ↑ Allan, Darren (March 25, 2026). "'The CPU shortage is getting more serious day by day, no less than the memory chip situation': PC maker warns about processor price hikes". TechRadar. Retrieved March 26, 2026.
  18. ↑ Martindale, Jon (March 25, 2026). "Intel, AMD Reportedly Set to Raise CPU Prices By Up to 15%". PCMag. Retrieved March 27, 2026.
  19. ↑ Zuhair, Muhammad (February 14, 2026). "Western Digital Has No More HDD Capacity Left, as CEO Reveals Massive AI Deals; Brace Yourself For Price Surges Ahead!". Wccftech. Retrieved February 17, 2026.
  20. ↑ "AI power: Expanding data center capacity to meet the demand". McKinsey & Company. October 28, 2024. Retrieved December 16, 2025.
  21. ↑ "State of Semiconductors 2025". Kearney. Retrieved February 17, 2026.
  22. ↑ Zandieh, Amir; Mirrokni, Vahab (March 24, 2026). "TurboQuant: Redefining AI efficiency with extreme compression". Google Research. Retrieved March 26, 2026.
  23. ↑ Nguyen, Britney (March 25, 2026). "Micron's stock is dropping. Is Google partly to blame?". MarketWatch. Retrieved March 26, 2026.
  24. ↑ Moadel, David (March 25, 2026). "Micron Falls as Q2 Earnings and AI Compression Put Memory Stocks on Edge". 24/7 Wall St. Retrieved March 26, 2026.
  25. ↑ Kundu, Kishalaya (April 10, 2026). "DDR5 prices drop nearly 30%, but memory costs are still far from normal". TechSpot. Retrieved April 28, 2026.
  26. ↑ "US semiconductor giant begins $9.3-billion chip plant expansion in Japan".
  27. ↑ "RAM Shortage 2025: How AI Demand is Raising DRAM Prices". Intuition Labs. December 14, 2025. Retrieved December 16, 2025.
  28. ↑ "[News] Samsung Reportedly Expands 1c DRAM Capacity for HBM4, Targeting 60K Wafers Monthly in 2025". TrendForce. September 12, 2025. Retrieved January 16, 2026.
  29. ↑ "Samsung, SK Hynix halt old equipment sales over fears of US backlash, FT reports". Reuters. March 12, 2025. Retrieved January 16, 2026.
  30. ↑ "Apple aims to source all US iPhones from India in pivot away from China, FT reports". Reuters. April 25, 2025. Retrieved January 16, 2026.
  31. ↑ Shilov, Anton (November 30, 2025). "NAND wafer shortages push November contract prices up by over 60% — market tightens as hyperscalers purchase capacity for AI data centers". Tom's Hardware. Retrieved December 16, 2025.
  32. ↑ Zuhair, Muhammad (March 15, 2026). "Memory Suppliers Are Actually Worried the Demand Boom Won't Last 'Too Long', and Are Already Rethinking Expansion Plans". Wccftech. Retrieved June 10, 2026.
  33. ↑ Hwang, Min-gyu (March 12, 2026). "Samsung Electronics Prepares for Memory Downturn Risk". The Chosun Daily. Retrieved June 10, 2026.
  34. ↑ James, Luke (March 18, 2026). "SK Group chairman says memory chip shortage will last until 2030 — wafer supply trails demand by 20%". Tom's Hardware. Retrieved May 7, 2026.
  35. ↑ Zafar, Ramish (May 18, 2026). "Ex-Samsung Chip Boss Says China's DRAM Blitz Could Crush The 414% DDR5 Price Spike Within A Year". Wccftech. Retrieved June 10, 2026.
  36. 1 2 "Tech Firms From Dell to HP Warn of Memory Chip Squeeze". Bloomberg News. November 26, 2025. Retrieved December 20, 2025 – via Yahoo Finance.
  37. 1 2 "Tech firms from Dell to HP warn of memory chip squeeze from AI". The Straits Times. November 26, 2025. Retrieved December 20, 2025.
  38. 1 2 Ferreira, Bruno (November 17, 2025). "AI-led DRAM supply crunch reportedly has Morgan Stanley downgrading major OEMs — skyrocketing memory prices could erode server and PC margins". Tom's Hardware. Retrieved January 16, 2026.
  39. ↑ Sigalos, MacKenzie (June 25, 2026). "Apple posts worst day in over a year after MacBook and iPad price hikes". CNBC. Archived from the original on June 25, 2026. Retrieved June 26, 2026.
  40. ↑ Leonard, John. "RAMpocalypse bites Apple: Macs and iPads jump in price". www.computing.co.uk. Retrieved June 26, 2026.
  41. ↑ Zuhair, Muhammad (November 3, 2025). "DRAM Prices Have Risen by a Whopping 172% This Year Alone, Prompting Memory Manufacturers to Halt New Orders For DDR Modules". Wccftech. Retrieved January 16, 2026.
  42. ↑ "Micron Announces Exit from Crucial Consumer Business". Archived from the original on February 20, 2026. Retrieved December 4, 2025.
  43. ↑ Anderson, Robert (November 18, 2025). "Sony is Knocking $100 Off PS5 Consoles for Black Friday 2025". IGN. Retrieved January 16, 2026.
  44. ↑ James, Luke (February 26, 2026). "HP says memory costs doubled in one quarter, now account for 35% of PC build materials". Tom's Hardware. Retrieved March 7, 2026.
  45. ↑ "[Exclusive] Memory Crunch Hits PCs: Dell Hikes Prices 15-20% Mid-December, Lenovo from January 2026". TrendForce. Retrieved March 7, 2026.
  46. ↑ Popal, Nabila; Reith, Ryan; Janukowicz, Jeff; Mainelli, Tom; Jeronimo, Francisco; Ma, Bryan (February 26, 2026). "Higher ASPs, lower unit volumes: How the memory crisis is reshaping the PC and smartphone outlook". IDC. Retrieved March 7, 2026.
  47. ↑ "Gartner Says Surging Memory Costs Will Reduce Global PC and Smartphone Shipments in 2026". Gartner. Retrieved March 7, 2026.
  48. ↑ Colantonio, Giovanni (April 27, 2026). "Valve confirms why the Steam Controller is launching before the Steam Machine". Polygon. Retrieved April 27, 2026.
  49. ↑ Notis, Ari (February 5, 2026). "Valve's Steam Machine delayed amid computer component pricing crisis". Polygon. Retrieved April 27, 2026.
  50. ↑ "AI and Compute". Center for Security and Emerging Technology. January 1, 2022. Retrieved May 27, 2026.
  51. ↑ Alegre, JP (March 31, 2026). "OpenAI Locked Up 40% of Global RAM With No Obligation to Buy Any of It". thedeepdive.ca. Retrieved April 11, 2026.
  52. ↑ Shilov, Anton (October 1, 2025). "OpenAI's Stargate project to consume up to 40% of global DRAM output — inks deal with Samsung and SK hynix to the tune of up to 900,000 wafers per month". Tom's Hardware. Retrieved January 16, 2026.
  53. ↑ "Samsung and OpenAI Announce Strategic Partnership to Accelerate Advancements in Global AI Infrastructure" (Press release). Samsung Global Newsroom. October 1, 2025. Retrieved January 16, 2026.
  54. ↑ "Nvidia shift, AI chip shortages threatening to hike gadget prices". CNBC. December 2, 2025. Retrieved December 20, 2025.
  55. ↑ Agarwal, Armaan (June 29, 2026). "Samsung, SK Hynix and Micron sued over alleged price-fixing amid RAM crisis". India Today. Retrieved June 29, 2026.
  56. ↑ "Court Docket 3:26-cv-06345" (PDF).
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