Commodity memory prices set to double as fabs pivot to AI market

Memory prices could soon be double what they were earlier this year as chipmakers switch to advanced products to target the AI market, leaving a shortfall of more mature chips such as those meeting the LPDDR4 standard. This is the warning from Counterpoint Research, which forecasts that memory prices are likely to rise 30 percent over current levels by the end of 2025, and possibly 20 percent further in the first half of 2026, due to critical chip shortages. Coming on top of 50 percent increases already this year, this will mean a potential doubling of prices by mid-2026. The research biz points to LPDDR4 supply tightness brought on by suppliers shifting production to more advanced chips for AI applications, which it says is distorting the market. As an example, it claims that DDR5 for servers and PCs has been trading at around $1.50 per gigabit, while older DDR4 components used in consumer devices have risen to $2.10, a higher price than even the High Bandwidth Memory HBM3e, which is used in GPUs. This follows similar reports from the likes of market watcher TrendForce, which also found that suppliers are allocating production capacity primarily to high-end server DRAM and HBM, leading to less capacity to serve the market for PC, mobile, and consumer chips. Counterpoint also foresees trouble brewing in the more advanced memory market, and Nvidia could be the cause here because of its use of LPDDR. "The bigger risk on the horizon is with advanced memory as Nvidia's recent pivot to LPDDR means it is a customer on the scale of a major smartphone maker – a seismic shift for the supply chain which can't easily absorb this scale of demand," claims Research Director MS Hwang. Nvidia is moving to this type of memory for lower power consumption in some products, it claims, rather than fitting memory with error-correcting code (ECC), as widely used in servers. Instead, error correction is handled by the Nvidia chips. Memory boom-bust cycle booms again as Samsung reportedly jacks memory prices 60% The $100B memory war: Inside the battle for AI's future Raspberry Pi prices hiked as AI gobbles all the memory PC memory costs to climb as fabs chase filthy lucre in servers and HBM However, as far as we are aware, Nvidia products such as its Grace CPU and Grace Hopper Superchip both use server-class LPDDR5X memory with ECC. We asked Counterpoint to clarify which Nvidia products it is referring to. The upshot is that a hike in the price of DDR5 64 GB RDIMMs is potentially in the cards for early next year, extending through to the end of 2026. This would see prices hitting double what they were in Q1 2025, if Counterpoint's predictions hold true. Samsung, one of the big three memory firms, has hiked prices 60 percent since September alone, The Register reported last week. TrendForce notes that the memory industry has begun an upward pricing cycle, and says that this will lead to increased overall costs for products such as smartphones and PCs. Currently, DRAM and NAND flash make up a 10-18 percent share of a laptop's bill of materials cost, it says, and this is likely to surpass 20 percent in 2026 as memory prices climb sharply over several consecutive quarters. ®