Why Phones and Laptops Cost More in 2026: The Memory Chip Shortage Explained

If you have shopped for a phone or laptop this year, you have probably noticed that the same money buys less than it did in 2025. A model you were waiting to go on sale costs more today than at launch. A new phone arrives with the same RAM as last year’s, but at a higher price. Some brands are even bringing back 4G-only models.

None of this is a coincidence. The cause is a global shortage of memory chips, and the reason behind that shortage is artificial intelligence. This guide explains what is happening in plain language, how it is affecting buyers in India, and what you can do to avoid overpaying for your next device.

What is the memory chip shortage?

Every phone, laptop, tablet and smart TV contains two kinds of memory. DRAM is the working memory (the “RAM” on a spec sheet) that keeps your apps running. NAND flash is the storage that holds your photos, apps and files (the “128GB” or “256GB” figure).

Only a handful of companies make these chips at scale, mainly Samsung and SK hynix in South Korea and Micron in the United States. Their factories can only produce so many wafers each year, and building a new factory takes years and billions of dollars.

In 2025 and 2026, a huge new buyer arrived: AI data centres. The servers that run chatbots and AI tools need a special, expensive type of memory called high-bandwidth memory (HBM), plus large amounts of server DRAM. Because HBM is far more profitable, chipmakers moved factory capacity toward it. According to market research firm IDC, that left fewer wafers for the ordinary memory used in phones and PCs, so prices rose and supply tightened. IDC describes it as a structural shift rather than a short dip.

How big are the price increases?

The numbers are large, even by the standards of a business that is used to boom-and-bust cycles.

• Memory prices: TrendForce forecast that DRAM contract prices would jump around 90–95% in the first quarter of 2026 alone, with NAND flash up 55–60% in the same period, as summarised by Panda Security. A further rise was forecast for April to June.
• Existing phones: Counterpoint Research’s price tracker found that phones already on sale had risen about 15% on average by September 2026, and that new models were launching at prices roughly 25% above their predecessors (reported by iClarified).
• Laptops and PCs: Dell, Lenovo, HP, Asus and Acer all signalled price increases, and IDC warned PC prices could rise by up to 8% if the shortage persisted (TechSpot).

Memory used to be a modest part of a phone’s bill of materials. Reports now put it at around a fifth of the manufacturing cost of an entry-level smartphone, with forecasts that the share could approach 40% (Gigazine, citing industry estimates). When one component becomes that expensive, brands have little room to absorb it.

Why India is being hit harder than most markets

The shortage is global, but its effect depends on what people buy. India is a market built on affordable phones, and that is exactly where memory costs bite hardest.

Counterpoint found that India saw the steepest price increases of any region it tracked, at about 21%, ahead of Asia Pacific and the Middle East and Africa. In the April to June quarter of 2026, India’s smartphone shipments fell 10% year-on-year, the steepest June-quarter drop in six years. Counterpoint’s Tarun Pathak told TechCrunch that around 60% of India’s market sits below ₹20,000, which is where higher memory costs move prices the most.

CyberMedia Research saw the same pattern earlier in the year. In the January to March quarter, the premium segment grew 25% while the affordable segment shrank 46%, as buyers on a budget delayed upgrades. CMR expects the Indian smartphone market to decline 10–12% across 2026 (IANS).

In short, people who can afford a flagship are still buying. Students, first-time buyers and anyone shopping in the ₹8,000–₹20,000 range are the ones squeezed.

The hidden effect: same price, worse specs

Not every brand raises the sticker price. Many quietly change what is inside the box instead. Counterpoint notes that manufacturers are lowering storage capacities, simplifying camera hardware and reintroducing 4G models in some price bands. Analysts also expect flagship RAM to stall at current levels rather than climbing to the next tier.

This matters because a lower price tag can hide a real downgrade. A phone that drops from 8GB to 6GB of RAM, or from 128GB to 64GB of storage, may feel fine on day one and sluggish two years later.

How long will the shortage last?

Most analysts do not expect quick relief. Counterpoint’s researchers told TechCrunch that memory shortages and elevated phone prices are likely to last until at least the end of 2027, although the pace of increases should slow as buyers get used to the new price levels. IDC has made a similar call for both DRAM and NAND.

There is one more reason not to hold out for a big price drop. Research firms expect that price rises already passed on to shoppers are unlikely to be reversed quickly, even when component costs eventually stabilise.

Seven ways to buy smart during the shortage

1. Compare against last year’s model

New launches carry the steepest increases. Last year’s model was designed and priced before the worst of the crunch, and often has the same chip and camera. Check whether the newer version is a real upgrade or just a pricier repackage.

2. Read the memory specs, not just the price

For a phone you plan to keep for three years or more, aim for at least 6GB of RAM and 128GB of storage. Avoid 64GB storage on any smartphone in 2026: apps and system updates will fill it fast.

3. Consider manufacturer-refurbished devices

Brand-certified refurbished phones and laptops come with a warranty and are inspected by the maker. They are a safer bet than an unknown second-hand seller and are often noticeably cheaper than new.

4. Time big purchases around sale seasons

Discounts are thinner this year, but the big festive and online sales still offer the best prices of the year on many models. Use a price-history tracker so you can tell a genuine discount from an inflated “MRP”.

5. Extend the life of what you already own

A battery replacement at an authorised service centre can make a two- or three-year-old phone feel new again, at a fraction of the cost of a replacement. Clearing storage and resetting the device can help too.

6. Check 5G and update promises

If a brand reintroduces a 4G model to keep the price down, make sure you are comfortable without 5G. Also check how many years of software and security updates the brand promises, since that decides how long the phone stays safe to use.

7. For laptops, prioritise RAM you can upgrade

Many thin laptops have memory soldered to the board. If you are buying a laptop for work or study, a model with a free RAM slot lets you add memory later, when prices hopefully ease, instead of paying today’s premium up front.

What this means for jobs and careers

The same AI boom that is raising device prices is also reshaping hiring. Memory makers are expanding factories, data-centre construction is creating engineering and technician roles, and employers across industries now ask for AI skills. If you are job hunting, our guide to AI skills employers want in India in 2026 explains which ones matter and how to learn them.

If you need a phone mainly for job hunting, you do not need a flagship. A reliable mid-range phone with good battery life, enough storage and long software support will run every major job app comfortably. See our roundup of the best job search apps in India.

Frequently asked questions

Why are smartphone prices rising in 2026?

Mainly because memory chips (DRAM and NAND) have become far more expensive. Chipmakers shifted production toward high-bandwidth memory for AI data centres, leaving less for consumer devices.

Should I wait for prices to drop before buying a phone?

If your current phone works, waiting is reasonable. But analysts expect the shortage to last until at least the end of 2027, so if you need a phone now, buying last year’s model or a certified refurbished unit is usually smarter than waiting.

Are budget phones affected more than flagships?

Yes. Memory is a much bigger share of a cheap phone’s cost, so the increase shows up more clearly. In India, the affordable segment has seen the sharpest fall in sales.

Will laptop prices also go up?

Yes. Major PC brands have announced or signalled increases, and laptops are affected by both RAM and SSD storage prices.

Is it a good time to buy a refurbished phone?

It can be, as long as you buy from the brand or an authorised refurbisher that offers a proper warranty and invoice.

Sources

• TechCrunch: AI-driven memory crunch jolts India’s smartphone market
• iClarified: Existing smartphone prices rise 15% in 2026 (Counterpoint Research)
• IANS: Memory price surge drags India smartphone market in Q1 (CMR)
• 91mobiles: Global memory shortage could disrupt smartphone and PC markets (IDC)
• TechSpot: Memory shortages could raise PC and smartphone prices
• Panda Security: What the RAM shortage means for your next upgrade
• Business Standard: Smartphone discounts fade as prices rise amid memory crunch