The global technology industry is heading towards a severe memory crunch as data centers, driven by explosive AI demand, are expected to consume nearly 70% of the world’s memory chip production by 2026.
What was once a niche concern within tech circles has now entered the mainstream, with the Wall Street Journal warning that the fallout will extend far beyond servers and cloud infrastructure.
The surge in AI workloads is forcing memory makers to permanently reallocate capacity towards data centers, leaving other sectors squeezed.
As a result, shortages of RAM, solid-state drives, and hard drives are set to ripple across consumer electronics, automobiles, and household appliances.
Even products that rely on older, legacy memory—such as TVs, Bluetooth speakers, set-top boxes, and smart appliances—could see sharp price increases as manufacturers struggle to secure supply.
Margins in these categories are already thin, and analysts warn that rising memory costs will inevitably be passed on to consumers.
Nvidia CEO Jensen Huang has suggested that RAM could soon account for 10% of the cost of most electronics and up to 30% of a smartphone’s bill of materials.
Industry trackers also echo the concern.
IDC has already cut its 2026 forecast, projecting a 5% drop in smartphone shipments and a 9% decline in PCs.
TrendForce and Counterpoint Research describe the situation as unprecedented, with memory capacity for 2028 reportedly already sold out.
The auto sector, in particular, risks Covid-like production delays—underscoring that this time, the shortage is structural, not cyclical.
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