TOKYO - Shoppers could face higher prices for phones, laptops and other gadgets next year, manufacturers and analysts warn, as AI data centres hoover up memory chips used in consumer electronics.
The world's biggest tech companies are ploughing head-spinningly huge sums into building the hardware that powers artificial intelligence tools like ChatGPT.
Their insatiable demand is snarling up a supply chain kept tight on purpose by chipmakers who are keen to avoid price drops that dent profits, experts say.
In high demand are key chips known as DRAM and storage components called NAND, which are found in everyday gadgets but are also needed to help process the vast amounts of data crunched by generative AI.
That's driving up memory chip prices, which in turn is turbocharging revenue for the firms that produce them such as South Korea's Samsung and SK hynix, and Micron and SanDisk in the United States.
Industry analysts TrendForce have lowered their 2026 global production forecasts for smartphones and notebook laptops.
"The memory industry has begun a robust upward pricing cycle," which "forces downstream brands to hike retail prices," TrendForce said.
Last week China's largest contract chipmaker SMIC said customers were hesitant to place orders owing to uncertainty over how many phones, cars, or other products the memory chip industry can supply.
The cause of the shortage is two-fold.
Price jumps for memory chips "are huge and the trend is continuing", said Stephen Wu, founder of the Carthage Capital investment fund.
"Consumers and enterprises should expect higher memory prices, longer lead times, and more take-or-pay contracts through at least early 2026," Wu said.