Consumers planning to buy new smartphones or personal computers (PCs) in 2026 should prepare for higher prices. The significant price hikes are driven mainly by the global surge in Random Access Memory (RAM) component costs.
A key factor behind this trend is the scarcity of memory chips caused by rising demand from the artificial intelligence (AI) industry. AI servers and data centers require large RAM supplies, limiting availability for consumer products. This supply-demand imbalance has pushed RAM prices upward in recent months and is expected to continue into next year.
Xiaomi’s President Lu Weibing has publicly warned customers about these pressures. During a November 2025 press conference, he noted that escalating memory chip costs are forcing companies to consider raising retail prices. “I expect the pressure to be much heavier next year than this year,” Weibing told Reuters. He added that consumers will likely see substantial price increases.
The price rise is not just a forecast but is already visible in the market. For example, the iQoo 15 flagship launched in Indonesia in December 2025 is priced at approximately $860 for the base model with 12 GB RAM and 256 GB storage. This represents a roughly 30% increase compared to its predecessor, the iQoo 13, priced around $670 with similar specsa year earlier.
Xiaomi has felt the impact as well, with memory chip price hikes prompting increases in smartphone prices. In October 2025, Weibing confirmed that the surge in chip costs compelled Xiaomi to raise prices on devices including the Redmi K90. The base model of this phone retails for about 2,599 yuan (around $370), up from 2,499 yuan ($357) for the preceding Redmi K80.
Key factors influencing price increases:
- AI industry’s large RAM consumption limits memory supply for consumer electronics.
- Ongoing global shortage of memory chips causing sustained price growth.
- Vendors’ strategy to offset rising costs by increasing product prices.
- Potential segment-wise differentiation, with premium devices absorbing more costly components.
Besides outright price hikes, smartphone companies are likely to reduce RAM capacity in entry-level and mid-range devices to maintain price competitiveness. This allows vendors to moderate final product prices, though consumer costs will still rise overall. As a consequence, users may notice compromises on specs in budget devices to cushion price shocks.
This supply challenge is also affecting the PC market. Both smartphones and PCs rely heavily on RAM chips that are in short supply. Consumers might need to plan purchases carefully or extend the usage cycle of current devices due to limited affordability.
For manufacturers, 2026 poses significant challenges in balancing quality and cost management. Companies must maintain attractive margins, avoid alienating customers with steep prices, and navigate volatile component costs. Experts also predict a widening gap between high-end smartphones, which will maintain premium specifications at higher prices, versus affordable models that might face downgrades in specs.
Global analysts forecast a 2.1% contraction in the worldwide smartphone market in 2026, with price increases being a major factor. The expansion of AI infrastructures exacerbates this trend while simultaneously promoting AI-powered smartphone features, creating a complex paradox in supply chains.
In the long term, the trajectory of device pricing will heavily depend on the semiconductor industry’s ability to scale memory chip production. How AI demand evolves will further influence supply pressures. This creates an economic reality where technological advances in one sector indirectly cause financial strain in consumer markets.
Consumers and industry players alike must navigate these shifting dynamics, adapting to a landscape where innovation and cost pressures are deeply intertwined.