Prices of smartphones, computers and home appliances could jump by 20 per cent this year, consumers have been warned, as artificial intelligence demand drives up the cost of memory chips used in electronics.<\/p>\n
Consumer electronics makers including Dell, Lenovo, Raspberry Pi and Xiaomi have warned that chip shortages are likely to add to cost pressures and force them to raise prices, with analysts forecasting increases of 5 to 20 per cent.<\/p>\n
Dell\u2019s chief operating officer Jeff Clarke said during an earnings call in November that the company had never seen \u201ccosts move at the rate\u201d they were rising now and the impact would inevitably reach consumers.<\/p>\n
British PC maker Raspberry Pi called the cost pressures \u201cpainful\u201d as it raised computer prices in December, while Lenovo, the world\u2019s biggest PC maker, was stockpiling memory chips and other critical components, chief financial officer Winston Cheng told Bloomberg TV in November.<\/p>\n
The global buildout of data centres to power AI models has spurred demand for cutting-edge high-bandwidth memory chips, leading chipmakers to deprioritise the lower-end semiconductors used in consumer electronics, said analysts.<\/p>\n
This has created shortages of dynamic random-access memory (Dram) chips, which are used in everything from cars to computers for temporary data storage. As a result, companies have been stockpiling chips and driving up semiconductor prices.<\/p>\n
\u201cWe are already seeing a supply shortage across the board,\u201d said Daniel Kim, an analyst at Macquarie. \u201cThe market is crazy with buyers in panic as they struggle to secure enough memory no matter how much they are willing to pay.\u201d<\/p>\n
Market researcher TrendForce forecast average Dram prices, including for high bandwidth memory chips, would rise between 50 and 55 per cent in the fourth quarter of 2025 from the previous quarter.<\/p>\n
Samsung and SK Hynix, the world\u2019s two largest memory-chip makers which control over 70 per cent of the Dram market, said orders for 2026 had already exceeded capacity. Samsung last month raised the price of some memory chips by as much as 60 per cent.<\/p>\n
\u201cAI-related server demand keeps growing and this demand significantly exceeds industry supply,\u201d said Kim Jae-june, a Samsung executive, during an earnings call in October.<\/p>\n
Consumers could end up paying the price. Macquarie\u2019s Mr Kim forecast electronics prices would increase 10 to 20 per cent in 2026, while CW Chung, joint head of Asia-Pacific equities research at Nomura, expected a 5 per cent increase given companies could seek savings elsewhere.<\/p>\n
Consumer electronics makers had no choice but to accept higher prices because cloud service providers such as Amazon and Google were signing long-term agreements with chipmakers to secure Dram supply for servers, according to Greg Roh, an analyst at Hyundai Motor Securities.<\/p>\n
Big US technology companies were expected to spend $620 billion (\u20ac528 billion) on AI infrastructure in 2026, up from $470 billion in 2025, according to Morgan Stanley, which forecast total global spending on AI data centres and related hardware would reach $2.9 trillion by 2028.<\/p>\n
\u201cAI data-centre inference demand is far greater than anticipated, depleting chip inventories for PCs and smartphones as well,\u201d said Peter Lee, an analyst at Citigroup. \u201cSupply will remain tight until 2027, with no additional capacity expected. Chip stockpiling will be worse in 2026.\u201d<\/p>\n
Lu Weibing, president of Chinese smartphone maker Xiaomi, which increased the price of its flagship product in October, said in November he expected supply chain pressures in 2026 to be \u201cfar greater than\u201d in 2025.<\/p>\n
Macquarie\u2019s Mr Kim warned that a worst-case scenario would involve the \u201cserious supply chain disruptions seen during the pandemic\u201d.<\/p>\n
Samsung said in November it would add a chip production line at its South Korean plant, while SK Hynix is building a $91 billion chipmaking cluster announced in 2024. \u201cWe are thinking hard about how to address all demand,\u201d said SK chair Chey Tae-won at a company event in November.<\/p>\n
But the new capacity is not expected to come online soon.<\/p>\n
\u201cWe are trying to increase supply, but it takes at least two to three years to build a chipmaking plant,\u201d said an industry executive in Seoul. Meanwhile, companies will have to \u201ceither raise product prices or sacrifice margins\u201d, said Citi\u2019s Mr Lee. \u2013 Copyright The Financial Times Limited 2026<\/p>\n","protected":false},"excerpt":{"rendered":"Prices of smartphones, computers and home appliances could jump by 20 per cent this year, consumers have been…\n","protected":false},"author":2,"featured_media":261864,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[73],"tags":[289,79,118940,18,19,17,24750,1470,5316],"class_list":{"0":"post-261863","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-business","8":"tag-artificial-intelligence","9":"tag-business","10":"tag-dell-computer","11":"tag-eire","12":"tag-ie","13":"tag-ireland","14":"tag-lenovo","15":"tag-samsung","16":"tag-xiaomi"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@ie\/115820676044211084","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/posts\/261863","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/comments?post=261863"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/posts\/261863\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/media\/261864"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/media?parent=261863"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/categories?post=261863"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/tags?post=261863"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}