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Apple extends hotel stays in South Korea amid Samsung and SK Hynix develpments

Apple has stationed executives in South Korean hotels close to Samsung and SK Hynix factories as the company works to secure long-term memory chip supplies. The move comes amid a global shortage of DRAM, with RAM prices surging up to 300% since mid-2025. The team is negotiating multi-year contracts for LPDDR5X modules required in upcoming iPhone models, currently costing roughly $70 per 12GB unit more than double the price at the start of 2025.

According to local reports, Apple’s purchasing teams are residing in hotels in Hwaseong, Gyeonggi Province, within easy access to semiconductor plants. The strategy aims to ensure a stable supply of critical components as AI-driven demand continues to strain the global memory market.

Tech Giants Compete for Scarce Memory

Apple is not the only tech company taking extreme measures. Dell, Google, and Amazon have also established extended stays in South Korea to secure memory chips. The high demand has even benefited local hotels, with business accommodations like Doubletree and Nine Tree in Pangyo seeing significant increases in long-term bookings.

Samsung and SK Hynix, however, remain firm on short-term contracts, providing quarterly agreements while anticipating further price hikes through 2027. Server DRAM prices in Q1 2026 have already risen 60–70% compared to Q4 2025, highlighting the tight supply situation.

AI Demand Fuels Memory Crunch

The shortage is largely driven by AI infrastructure needs, particularly high-bandwidth memory (HBM3E) for AI accelerators like Nvidia’s H200, which requires eight HBM3E units per card. Chinese orders alone have added approximately $3 billion in new demand since receiving U.S. export approval, further limiting DRAM availability for smartphones and other consumer devices.

Industry analysts note that memory now accounts for over 20% of smartphone production costs, up from around 15% in previous quarters. While this could pressure Apple to adjust pricing or device specifications, its high-margin products and iOS efficiency may allow it to navigate the shortage more effectively than competitors.