Consumers will likely pay more for the next generation of phones as a global memory shortage raises component costs, a pressure that may last years. As Apple prepares to unveil new iPhones this week, the models are expected to carry higher price tags, the clearest sign yet that escalating memory expenses are reaching consumer devices.
The squeeze has multiple origins. During the pandemic, demand for laptops, tablets, and phones surged and pulled future purchases forward, leaving makers with excess inventory when consumer spending cooled. That downturn paused expansion plans, and by 2021 Micron concluded that simply fitting more chips onto each wafer would no longer keep pace with long-term demand. Then generative AI arrived and created a much bigger, more memory-intensive market than manufacturers anticipated.
Production is concentrated, which intensifies the shortage. Counterpoint estimates roughly 90 percent of the memory market sits with three firms, with Samsung controlling 39 percent, SK Hynix 26 percent, and Micron 25 percent in Q2 2026. Those companies face a choice about how to allocate limited capacity between AI infrastructure and consumer electronics, and the incentives increasingly favour high-paying, multiyear AI contracts.
Different types of memory pull on capacity in different ways. High-bandwidth memory, HBM, is more complex to make and uses far more silicon per finished unit than conventional DRAM. Micron estimates producing a given amount of HBM requires roughly three times as many wafers as conventional DRAM. David Naranjo, associate director at Counterpoint, summed up the distinction, "It’s not as simple as saying data centers are consuming RAM. The RAM is not the same."
Chipmakers are responding by negotiating long-term commitments with the biggest buyers. "We have been engaging in discussions with customers, prioritizing those who can guarantee committed future captive demand," said Jaejune Kim, Samsung’s executive vice president of memory. Micron’s Manish Bhatia added, "We need to build more wafer capacity," underscoring that resolving the imbalance will require new fabs and years of additional production.
The result is a structural shift in memory economics: rising DRAM and HBM prices are feeding through to consumer hardware, and manufacturers appear willing to allocate scarce supply toward the richest, most predictable customers. That dynamic puts phone buyers at risk of paying more, device makers under pressure to redesign for on-device AI, and the industry on a multiyear timeline before capacity catches up with demand.
