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Memory chip shortage to pressure PC market through 2027, Compal says

Contract manufacturer expects memory costs to reach up to 40% of PC materials as AI demand tightens supply

Surging memory chip prices will continue through 2027 and significantly impact the PC industry as manufacturers prioritize AI server production over traditional computing devices, according to Compal Electronics, a major contract manufacturer for notebooks and personal computers.

The Taiwan-based company said it expects global notebook and PC shipments to decline by a low single-digit percentage in 2026 as rising memory costs affect the market.

AI demand driving supply constraints

Memory chip costs, which typically account for 15% to 18% of a PC's materials cost, could rise to as much as 35% to 40%, according to Anthony Peter Bonadero, Compal's chief executive officer. The company said pricing volatility in memory will persist as the top three manufacturers—Samsung Electronics, SK Hynix and Micron—prioritize high-bandwidth memory for AI servers.

"It's a true super cycle in memory chips that we haven't really seen," Bonadero said in a statement. The three memory chip producers have said in recent months they are struggling to meet demand as AI data center rollouts have tightened chip supply.

Compal expects its own notebook and PC business to remain flat or see slight growth, supported by its customer mix, according to Bonadero. "We believe the total market will be impacted for sure," he said.

The company said it expects to see pricing volatility similar to late 2025, with the major memory manufacturers prioritizing AI server high-bandwidth memory over PC components.

Expanding AI server operations

Compal has been restructuring to expand its AI-related and AI server business, according to Chairman Ray Chen. The company approved $500 million last year to expand U.S. operations, with a Texas factory expected to be completed in the second quarter and begin producing AI servers later this year.

The manufacturer is also expanding capacity in Taiwan and Vietnam in response to customer demand for geographically diversified supply chains, the company said.