What the RAM shortage is and why it matters for phones
The current smartphone RAM shortage is a global squeeze in memory chip supply driven by surging demand from AI data centers, which pushes up component costs and forces phone makers to raise prices or cut specifications for new devices. Memory chip prices have nearly tripled since early 2025, and this is not due to a factory disaster but to AI infrastructure buying every chip it can secure. AI servers mostly use high‑bandwidth memory, but that and mobile DRAM are built on the same manufacturing lines, so capacity shifted to AI leaves fewer chips for phones. According to Counterpoint Research, mobile DRAM prices have risen close to 70% since early 2025, and NAND flash storage prices have nearly doubled. As a result, smartphone prices have already risen 6–25% in many markets, and the pressure is not easing.
How AI data centers are draining memory and driving up costs
Behind the RAM shortage phone prices crisis is a clear profit calculation. Chipmakers like Samsung, SK Hynix, and Micron earn far more per gigabyte selling high‑bandwidth memory to AI data centers than mobile DRAM to phone brands. IDC reported that DRAM supply growth will fall well below historical norms in 2026 as wafer capacity is reallocated to high‑bandwidth memory for AI inference clusters. By May 2026, those three memory giants had a combined market cap approaching USD 3 trillion, a direct reflection of this shift. The overlap in factory capacity means AI data center memory soaks up production, leaving smartphone makers to compete for what remains at much higher prices. Memory now accounts for more than 20% of the total cost to build a mid‑range smartphone, up from roughly 10–15% in earlier years, so even a modest component spike hits retail prices hard.
Which phones are hit hardest by the smartphone price increase
The smartphone price increase 2026 is not uniform: budget and mid‑range phones feel the most pain, while flagships rise more gently but from already high levels. For budget phones under USD 200 (approx. RM920), memory can be 25–30% of the parts cost, so a 70% rise in RAM pricing leaves little room for profit. DigitBin estimates budget devices face 20–30% price hikes, and some brands are cutting production instead of selling at a loss. Mid‑range phones in the USD 200–500 (approx. RM920–RM2,300) band see memory accounting for 18–22% of cost and estimated retail increases of 10–15%. Flagships above USD 800 (approx. RM3,700) are better protected because their margins are larger, but even here price rises of 6–9% are expected as brands bake higher memory bills into new launches.
Samsung price hikes and how other brands are responding
Samsung sits at the center of this storm as both a leading smartphone brand and a major memory supplier, so its moves highlight how AI data center memory demand feeds into higher retail prices. Reports from Europe say selected Galaxy S models and the Galaxy Z Fold7 and Z Flip7 are seeing price tags jump by around €100, and analysts expect more increases in the second half of the year as the memory shortage deepens. DigitBin notes that the Galaxy S26 and S26 Plus launched with a USD 100 (approx. RM460) increase over their predecessors, framed as a storage upgrade from 128GB to 256GB, but driven by RAM and NAND inflation. Apple has so far absorbed more of the shock but has warned investors that memory is starting to weigh on margins, while Google is rumored to be shipping lower RAM in Pixel 11 to contain costs.
Tariffs, AI hardware demands and what buyers can do next
Rising RAM and storage prices are only part of the smartphone price increase 2026 story. Samsung has told The Verge that global shortages of RAM and other materials, combined with tariffs, made a “significant contribution” to earlier price hikes and could pressure future Galaxy flagship pricing. New reports suggest that AI‑related hardware demands will keep component costs elevated, and analysts believe foldables and premium flagships may be hit hardest as manufacturers chase advanced cameras, AI features and longer battery life within their margins. For buyers, this means fewer bargains, especially in the budget tier, and more trade‑offs like reduced RAM or storage at the same sticker price. If you are sensitive to RAM shortage phone prices, consider buying during promotional periods, looking at last‑year flagships, or double‑checking RAM and storage specs so you do not pay more for a weaker device.