How will the RAM shortage hit smartphone sales?

Memory bottleneck threatens device affordability and shipments

A global shortage of DRAM and other memory components is now feeding directly into forecasts for smartphone shipments and PC sales. Analyst firm IDC warned that higher memory costs would push device prices up and weigh on demand, forecasting what would be the industry’s largest annual decline in smartphone volumes in recent memory.

Manufacturers face sharply higher component bills: memory prices have surged because hyperscale AI deployments and data-center expansions are gobbling DRAM, tightening supply for consumer devices. Hardware makers like HP have quantified the squeeze by pointing out that memory now represents a much larger share of a PC’s bill of materials than it did previously. When a core component accounts for a growing percentage of costs, vendors either absorb the hit, cut margins, or raise retail prices — the latter risks depressing volume sales.

Practical impacts and likely industry responses

• Fewer cheap phones: entry-level and budget devices are most at risk as their thin margins vanish.
• Higher retail prices: midrange models may creep up in price, pushing some buyers to defer upgrades.
• Supply prioritization: vendors may allocate constrained memory to higher-margin flagships or to enterprise customers.
• Longer replacement cycles: consumers reluctant to pay more may keep older devices longer.

Why this matters

Smartphone and PC markets have historically depended on a steady stream of low-cost devices to maintain global shipment growth. A sustained memory shortage could permanently reshape product lineups, reduce the number of new devices sold, and compress the market for budget-conscious consumers. For the broader tech ecosystem, this pressure also feeds back into component pricing, retail promotions, and vendor strategies for future inventory and contracts.