A widening shortage of DRAM and NAND memory chips is squeezing the global technology industry, constraining production, inflating prices, and compressing profit margins. Since the start of 2026, more than a dozen major corporations have signaled that the shortage will hamper operations.
Micron Technology has described the bottleneck as “unprecedented.” Tesla CEO Elon Musk stated during the company’s late January earnings call that the electric vehicle maker may need to build its own memory fabrication plant to secure supplies. “We’ve got two choices: hit the chip wall or make a fab,” Musk said. Apple CEO Tim Cook warned that rising memory costs would compress iPhone margins, projecting gross margins of 48% to 49% for the March quarter.
The primary driver of the shortage is the aggressive expansion of AI data centers by Alphabet, Amazon, Microsoft, and Meta. Combined spending on AI infrastructure for 2026 is estimated to reach $650 billion, up from approximately $360 billion the previous year. These hyperscalers are purchasing millions of Nvidia AI accelerators containing large memory allotments, leaving consumer electronics producers competing for dwindling supplies from Samsung Electronics, SK Hynix, and Micron.
Manish Bhatia, Micron’s Executive Vice President, said high-bandwidth memory for AI chips is consuming so much capacity that it is creating a “tremendous shortage for the conventional side.” Nvidia is reportedly delaying new gaming GPUs for the first time in nearly three decades to prioritize limited memory for AI accelerators. Sony is considering pushing back its next PlayStation console to 2028 or 2029, while Nintendo is contemplating price increases for the Switch 2.
The automotive sector faces growing pressure as DRAM manufacturers shift capacity toward AI. Analyst MS Hwang reported “signs of panic buying” in the auto sector. Chinese smartphone makers Xiaomi and Oppo are trimming 2026 shipment targets, with Oppo cutting its forecast by as much as 20%.
Synopsys CEO Sassine Ghazi said the shortage is likely to persist through 2026 and 2027, noting that building new chip facilities takes years. Lenovo CEO Yang Yuanqing confirmed the crunch will last at least through the rest of the year.
