AI-driven memory shortage sends PC prices up 40%

The insatiable appetite of artificial intelligence data centers for memory chips has created a global shortage that is now hitting consumers where it hurts: the price of everyday electronics. Research firm IDC data from Singapore shows average PC prices surged up to 40 percent year-on-year in the second quarter of 2026, while Apple ↗ 1.75% has raised prices on older iPhones rather than discounting them after new launches, a break from years of tradition.

The crisis traces to a single cause. Samsung, SK Hynix ↗ 0.94%, and Micron ↘ 0.22% — the three companies that dominate memory production — have shifted factory capacity toward high-bandwidth memory for AI servers, which commands far higher margins than the DDR5 and NAND flash used in consumer devices. The result is a squeeze felt from Sim Lim Square in Singapore to Apple stores in Mumbai.cnbc+1

The Price Shock

IDC figures reported by The Straits Times show that regular laptop prices in Singapore rose 26 percent to S$1,650 in Q2 2026, while gaming desktop prices jumped 39 percent. The Straits Times found that 32GB DDR5 RAM kits in Singapore nearly quadrupled, from S$195 to S$763 over a year, and 1TB SSDs more than doubled from S$149 to S$328. IDC forecasts PC average selling prices will climb 17 percent globally for the full year.straitstimes+1

Retailers are feeling the pain. At Singapore's Sim Lim Square, shop owners told The Straits Times that sales have dropped between 20 and 80 percent compared with 2025. "It's very, very difficult. Sometimes we cannot cover our rent," said John Soroya, owner of R Zech Laptop.straitstimes

Apple Breaks With Tradition

Apple last week raised prices on every previous-generation iPhone still for sale, adding $100 per model in the United States and significantly more in markets like India, where the iPhone 17 jumped from Rs 82,900 to Rs 99,900. The move upends Apple's longstanding practice of making older models more affordable after each new launch.techrepublic+1

The increases follow Apple CEO Tim Cook's warning in a June interview with The Wall Street Journal News Corp ↘ 0.21% that price hikes were "unavoidable." Cook called the memory supply situation "unprecedented" and said the company could no longer absorb the cost increases it was facing.reuters+1

No Quick Relief

The shortage shows no sign of easing soon. Phison ↘ 3.63% CEO K.S. Pua has warned that NAND flash shortages could last years, with 2026 production already sold out and new capacity not expected until late 2027. Meanwhile, TSMC Taiwan Semiconductor Manufacturing Company Limited ↗ 1.22% reported record August revenue of NT$514.81 billion, up 53.3 percent year-on-year, underscoring the scale of AI chip demand pulling resources across the semiconductor supply chain.tech-insider+2

IDC expects no meaningful relief before the end of 2027, forecasting global PC shipments will decline 11.3 percent for the full year of 2026 as manufacturers struggle to maintain product lines. "Any meaningful easing on PC prices is more likely a story for 2028 and beyond rather than in the near term," said Ho Jin Wei, an associate research analyst at IDC Asia Pacific.idc+1