The data center boom is making the memory shortage even worse

• Micron CEO Sanjay Mehrotra said on the memory makers’s June 24 earnings call that “demand continues to significantly exceed industry supply” and he expects “tight conditions to persist beyond calendar 2027 as a result of AI-driven demand across all segments coupled with structural supply constraints.”
• Research firm Trendforce wrote on June 22 that the three major DRAM suppliers “continue to prioritize advanced-node production to support growing demand” being “driven by AI infrastructure investments.”
• Jefferies analysts recently wrote in a note last week that memory consultant Ethan Tan expects memory pricing will rise 40%-50% quarter-over-quarter in Q3, and by another 30%-40% in the Q4. He expects 2027 price hikes of around 40% to 45% year-over-year.
• While announcing its third round of Xbox price hikes since 2025, Microsoft signaled further pain ahead: “Unfortunately, console storage and memory prices have increased by more than 2.5x and we expect another doubling by the fall of 2027.”
• IDC wrote in a June 2 report that “the global PC market is heading into a turbulent second half of 2026, and there’s no quick fix on the horizon.” The market research firm “forecasts global PC shipments will decline 11.3% for the full year, with conditions worsening progressively through Q4, when shipments are expected to fall 20% year-over-year.”
• Apple boosted Mac and iPad prices, along with other accessories, by hundreds of dollars, with Tim Cook saying memory pricing is “a hundred-year flood,” and consumer “price increases are unavoidable.”
• Elon Musk agreed with Cook, calling it the “biggest price jump in anything I’ve ever seen,” the “production shortfall relative to demand is insane,” and “MUCH higher production is needed.”

The good news is that there are efforts underway to expand the memory supply, which, in theory, should loosen the boot currently pressed against the throat of consumer electronics companies.

But spinning of memory chip production lines takes time — and there’s no guarantee that companies like Apple will decrease MacBook or iPad prices even if their component costs decrease.

In the meantime, the impact of the AI buildout is burrowing into people’s wallets in a way that’s become impossible to ignore. Don’t expect that to change anytime soon.