AI Boom Fuels Memory Price Hikes: Samsung Joins Micron and SanDisk in Raising DRAM and NAND Costs

The Unseen Force Behind Rising Memory Prices: Artificial Intelligence's Insatiable Appetite

Get ready to open your wallets a little wider. The cost of essential digital building blocks – DRAM and NAND flash memory – is set to climb, with major players like Samsung announcing price hikes of 15-30%. This isn't an isolated incident; it follows similar moves by industry titans Micron and SanDisk, who have already nudged prices upward for their memory components. SanDisk initiated this trend with a NAND price increase exceeding 10% recently, and Micron followed suit this month, escalating both DRAM and NAND costs by a significant 20-30%.

AI's Demand Driving the Memory Market Surge

The primary catalyst behind this looming price escalation? The insatiable demand fueled by the artificial intelligence (AI) revolution. As reported by the Korean publication New Daily, Samsung has informed its partners about these upcoming price adjustments, particularly impacting LPDDR4X, LPDDR5, and LPDDR5X RAM in the fourth quarter. These will see an increase of 15-30%. While data storage NAND, specifically eMMC and UFS, will experience a more modest but still notable jump of 5-10%.

The surge in demand isn't solely confined to high-end AI servers. The market for smartphones and computers boasting AI capabilities is exploding. Add to this the perennial uplift in sales during the holiday season for smartphones, tablets, and performance-driven PCs, and you have a perfect storm creating additional pressure. This confluence of factors makes further price increases almost a certainty.

Beyond Consumer Devices: NVIDIA's Role in Memory Scarcity

The appetite for cutting-edge memory extends far beyond consumer electronics. Companies like NVIDIA, at the forefront of AI hardware development, are voraciously consuming high-performance, energy-efficient memory for their powerful AI infrastructure. This intense corporate demand adds another layer of strain to the already tight supply chain.

Citigroup estimates a global DRAM supply deficit of 1.8%, with the NAND shortage expected to be even more pronounced, potentially reaching 4%. Morgan Stanley paints an even grimmer picture, projecting that by 2026, NAND supply could trail demand by a staggering 8%. These figures underscore a fundamental imbalance between what the world needs and what the memory manufacturers can produce.

The Shifting Sands of Memory Standards

Adding to the complexity is the industry's rapid pivot towards newer memory standards, namely DDR5 and High Bandwidth Memory (HBM). This strategic shift has led to a significant reduction in the production of older standards like DDR4 and LPDDR4X. The consequence? A dramatic 50% surge in the average price of DDR4 in July, a situation so unusual that this older memory technology briefly became more expensive than its successor, DDR5.

Interestingly, Samsung had initially planned to cease production of DDR4 and LPDDR4X entirely by June 2025. However, the unexpected and robust demand for these legacy components has prompted a reconsideration of that aggressive timeline. As of the second quarter of 2025, Samsung holds a commanding 32.7% share of the DRAM market and 32.9% of the NAND market, positioning it as a key influencer in these price movements.

The Impact on Consumers: A Strained Upgrade Cycle

While this pricing power offers a welcome respite for memory manufacturers who have often struggled with profitability, it spells trouble for everyday consumers and PC builders. Those without the deep pockets of large corporations will find their upgrade budgets stretched thin, and the cost of acquiring new devices will inevitably climb. The era of cheap, plentiful memory seems to be receding, at least for the foreseeable future, as the world grapples with the immense computational demands of artificial intelligence.