Chipmakers laughing all the way to the vault as memory prices go stratospheric

Semiconductor revenue is set to nearly double this year, with Gartner projecting the industry will bring in $1.6 trillion in 2026, up sharply from $809 billion in 2025 Memory chips are driving almost all of that growth: DRAM and NAND revenue are each expected to roughly triple or quadruple, pushing memory past non-memory chips in total revenue for the first time. Gartner expects memory alone to top $1 trillion by 2027. Last year, memory revenue was $220 billion vs $589 billion for non-memory chips. DRAM revenue is expected to bounce 246.6 percent in 2026, while NAND flash revenue is expected to see growth of 371.9 percent. The ultimate cause of this run on memory is the AI infrastructure construction boom, underpinning demand for high-end servers and GPUs. Manufacturers such as Samsung, Micron, and SK Hynix found it more profitable to prioritize production of these chips, leading to a shortfall of the mainstream memory types needed for PCs, smartphones, and other devices, bumping up average unit prices in this area. The Register has reported on sharp price hikes that buyers of PCs and of smartphones are facing. The market for phones in particular is forecast to shrink by 15 percent this year, as consumers balk at higher price tags. Chipmakers have also locked in high prices for longer by striking deals with large customers who are paying for longer-term supply stability. Micron announced this in June, while SK Hynix and Samsung revealed similar arrangements in July. Gartner believes that AI infrastructure has fundamentally changed the dynamics of the memory market, meaning higher prices are not cooling the growth in demand as seen in previous tech industry boom and bust cycles. “The semiconductor industry is entering a fundamentally new phase of growth,” claims Ben Lee, director analyst at the firm. “As AI infrastructure scales, it is not only reshaping investment across the semiconductor ecosystem but also redefining the industry’s application mix." The AI datacenter ecosystem is expected to grow from 36.5 percent of semiconductor revenues in 2026 to more than 53 percent by 2030. This represents a structural shift in where semiconductor value is created and how demand is evolving across the industry, Lee says. All this is bad news for anyone hoping memory prices might come down in the near future. Gartner is forecasting sustained demand for high margin memory products, including HMB. Samsung warned last month that the memory supply crunch will likely deepen next year and persist through 2028. Gartner's own projection calculates that semiconductor revenue will reach $1.9 trillion In 2027, an increase of about 20 percent on this year. ®