What sky high RAM prices mean for your next smartphone?

If you’ve considered building or upgrading a PC lately, you’ve likely noticed the shockingly high price of memory. RAM kits that sold for reasonable sums just a year ago now routinely cost two to three times as much, and prices continue to rise while some sets are increasingly challenging to obtain entirely.

Smartphone owners may feel insulated from these swings, since we don’t buy or install mobile RAM ourselves. However, the same forces driving up PC memory prices are quietly reshaping the smartphones we may plan to purchase next year. Here’s what you need to know.

The price of RAM components has increased over the past few months, primarily due to the surge in demand for AI-related products. Data center providers, such as Amazon and Oracle, have been acquiring DDR5 — currently the fastest motherboard memory available — to meet the growing demand for high-performance computing in the cloud. Worse, modern AI servers can feature several terabytes of DDR5, compared to older servers that may have used just 128GB or 256GB of DDR4. AI infrastructure is absorbing an outsized share of global DDR5 output, meaning that PC consumers are directly competing with some of the biggest tech players for RAM modules.

However, the larger culprit is that the AI boom is pushing RAM manufacturers to divert capacity to other memory formats. High Bandwidth Memory (HBM), for example, is used for the large virtual memory pools packed into NVIDIA’s dedicated AI cards, such as the H100 and GH200. HBM is built using the same wafers as DDR4 or DDR5, while the profit margins can be 2x to 5x higher.

As such, Samsung Electronics, SK Hynix, and Micron Technology — the big three that account for at least 75% of global RAM production — have shifted a significant amount of DRAM to the far more profitable HBM since 2023. This has led to a reduction in capacity dedicated to the vast range of other consumer and enterprise RAM types, including DDR, LPDDR, and GDDR, among others.

To highlight just how ravenous the AI behemoth has become, in October 2025, OpenAI signed letters of intent with Samsung Electronics and SK Hynix to supply memory components for its large-scale “Stargate” AI infrastructure project. Industry reports suggest that anticipated memory demand for this initiative could reach as high as 900,000 DRAM wafers per month — a volume that, if fully realized, would command a substantial share of global DRAM wafer capacity. However, the exact product mix and delivery commitments remain projections rather than finalized purchase orders.

In brief, demand for memory is exceptionally high, while supply remains tight. It’s a seller’s market right now, and consumer electronics aren’t even at the top of the bidding list. The real squeeze comes from DRAM makers prioritizing HBM production — effectively shrinking the pool of memory available to smartphones and PCs.

Crucially, this shortage isn’t accidental. DRAM manufacturers are deliberately avoiding aggressive capacity expansions after being burned by oversupply cycles in 2018 and 2022. Even as prices rise, suppliers have shown a strong preference for margin discipline over chasing volume — meaning relief may come slower than we would like.

OK, but why aren’t smartphones safe? Well, they use LPDDR5 or LPDDR5X instead of DDR5 or HBM. Although LPDDR and DDR5 differ electrically and in packaging, they are often produced on the same advanced DRAM nodes, meaning capacity decisions upstream affect both markets. Worse, in the memory pecking order, mobile DRAM is likely in third place, behind the more profitable server memory and HBM for AI applications.

Unfortunately, there doesn’t appear to be an obvious release valve on the horizon with which to relieve the pressure. While sky-high prices may make DDR5, LPDDR5, and other types a bit more profitable compared to HBM, there’s certainly no guarantee that fabs will undergo the expensive and time-consuming retooling needed to divert capacity in a meaningful way. At least not in a hurry.

Additional capacity is expected to come online, but this might not alleviate the bottleneck until 2027. For example, SK Hynix’s M15X facility (focused on HBM and DRAM) is set to begin production in 2026, while Micron’s Idaho fabs are expected to begin operations in the second half of 2027. By the time a sufficient supply reaches the market, we may be facing a rather pessimistic scenario, with meaningful price relief not arriving until closer to 2028.

As such, Counterpoint Research has revised its 2026 smartphone shipment estimates down by 2.6%. It notes that smartphone build costs are expected to rise by 10-25% (between flagship and budget models) by the end of the year and could surge by another 10-15% by mid-2026. The RAM crunch is undoubtedly adding some high costs to next-gen smartphones.

Indeed, we could be looking at more expensive smartphones next year, not just in the premium tier of the market. We’ve already seen reports that the Galaxy S26 might be more expensive than its predecessor, owing to a 16% increase in LPDDR5 costs. Xiaomi has also warned that prices are likely to be higher in 2026, owing to memory chip prices. Lower-end models are particualrly susceptible to RAM prices, as memory consumes a larger portion of the BOM and these models have trimmer margins to begin with.

However, supply could be the bigger issue. Even Samsung Semiconductor won’t commit to an affordable bulk RAM deal with Samsung Electronics, suggesting that even the most prominent players might struggle to weather the storm with enough capacity to meet earlier expectations. Capacity constraints increasingly look unavoidable.

Faced with sustained memory price inflation, smartphone manufacturers have several levers they can pull to protect margins — none of them particularly consumer-friendly.

The most obvious response is to ship less RAM per device. Memory upgrades are almost certainly off the table, and phones with 16GB of RAM may sell in limited quantities or may not be available at all. For example, the Odin 3 Ultra handheld gaming console is delayed due to a shortage of affordable memory. We may even see the return of 6GB or perhaps even 4GB models in budget segments, which would be somewhat alarming from a performance perspective.

Alternatively, OEMs may shift the perception of value away from RAM and toward storage, pairing lower RAM values with higher NAND capacity to achieve a marketing boost. For example, we may see simpler SKUs with, say, just a single RAM configuration across all storage tiers. If this happens, we may rely more heavily on memory compression (ZRAM) and technologies like “Memory Extension,” which use storage as RAM swap space, may make a reappearance in marketing materials.

Finally, brands that are more sensitive to price pressure might have to resort to weakening other specifications to offset the higher cost of RAM. Particualrly in budget models, we could see additional camera lenses sacrificed, downgrades to display specifications, or even backing out on features like wireless charging or expensive IP certifications.

Even if RAM prices eventually stabilize, the smartphones we buy in 2026 may already be shaped by today’s memory crunch — with fewer high-RAM options, slower hardware progress, and higher prices across much of the market.