AI is buying up the world's RAM, and your next laptop will pay for it

Why AI chips eat so much memory capacity

AI accelerators from Nvidia and others rely on high-bandwidth memory, or HBM. HBM is a stack of DRAM chips packaged right beside the processor so data can move very fast. The amount on each chip keeps growing: TrendForce says it rises by half or more this year, and expects Nvidia's Rubin Ultra platform to reach 384GB per GPU in 2027.

The real problem is efficiency. HBM uses far more silicon wafer for every gigabyte it delivers than the memory in a laptop does, more than twice as much by TrendForce's numbers. It estimates that by the end of 2026, HBM will take about a fifth of the DRAM wafers started by the three big suppliers but produce less than a tenth of the memory, and that by the end of 2027 the share of wafers will reach nearly a third.

In plain terms, nearly a third of the industry's DRAM wafers could soon be making memory that never reaches a consumer device. TrendForce describes this as a "crowding-out effect" on regular DRAM capacity. Micron's chief executive, Sanjay Mehrotra, said on the company's Sept. 30 earnings call that HBM will keep growing faster than conventional DRAM through 2028, and he called its trade ratio, meaning the extra wafers each HBM bit takes, a headwind for supply growth.

The suppliers are posting the best numbers in their history

You can see the shortage in the chipmakers' results. Micron (MU) brought in about $54 billion in its fiscal fourth quarter, which ended Sept. 3, nearly five times what it took in during the same quarter a year earlier. It expects to beat that, forecasting about $61.5 billion for the current quarter.

Micron's buyers are lining up well ahead of time. Mehrotra said more than 75% of Micron's fiscal 2027 output is already spoken for, and the company has signed more than two dozen long-term agreements with strategic customers that run through 2030. Investors weren't all cheering: the shares slipped slightly after hours on results day, which Investing.com put down to caution about Micron's plans to raise capital spending.

SK hynix, the largest HBM supplier, showed the same pattern. In its second quarter, roughly three of every four won in sales became operating profit. The company said it had signed long-term agreements with about 10 key customers because "customer demand exceeds supply capabilities".

Those agreements matter to ordinary buyers. Memory that cloud giants reserve years in advance can't be sold to a laptop brand that shows up later.

What it means for laptops, phones and SSDs

Device makers have two ways to deal with memory costs: charge more, or put less memory in the box. TrendForce warned last December that both would happen. It said cutting specs or delaying upgrades had become "an essential cost-saving measure" for phone and laptop makers. It also noted a trap for premium ultrathin laptops: their memory is soldered to the board, so brands can't save money by fitting smaller or cheaper modules.

By May, you could see it in the phones themselves. TrendForce said high-end phones were settling at 12GB instead of moving up, and mid-range phones were slipping back to 8GB, because mobile memory prices were rising faster than phone makers could absorb. It expected LPDDR5X, the memory in most current flagships, to jump roughly 80% in the second quarter alone.

One nuance: TrendForce still expects average smartphone memory to grow about 10% this year, to 8.5GB. That's mostly because the cheapest 2GB and 3GB models are disappearing altogether, which raises the average. Phone makers are also asking app developers to cut memory use and are moving more features to the cloud.

Budget buyers are hit hardest. IDC says sub-$100 phones face an "existential crisis" and that the low end of the market fell almost 60% from a year earlier in the second quarter. Those are the phones people buy when they can't spend more.

The PC market shows similar strain. IDC expects shipments to fall as much as 20% year on year in the fourth quarter. Early in the year, some buyers rushed purchases. IDC's Jean Philippe Bouchard said fear of higher prices and "limited availability of some system configurations" pushed some buyers to purchase earlier than planned.

Storage is a mixed picture. TrendForce says makers of consumer SSDs have been more flexible on price because their buyers already hold enough inventory. Enterprise SSDs are a different story. They're the only memory category where TrendForce expects price increases to speed up this quarter, driven by AI infrastructure demand it puts at more than 80% bit growth year over year.

Some signs of relief, and why they may not hold

There's some good news. TrendForce says increases are slowing: mobile DRAM's rise should ease this quarter because big jumps are already reflected in prices, and higher notebook prices are now "weighing on end-market sales". In other words, consumers are starting to push back by buying less.

Price competition is also helping at the low end. IDC analyst Jitesh Ubrani said Apple's MacBook Neo is putting pressure on the whole PC market and helping keep "some low-cost notebook options alive". Micron also argued that PC and phone industry revenue is still on track to grow this year despite what Mehrotra called "potential double-digit overall unit declines". Rising prices are making up for lower volumes, at least for now.

The risk lies in how suppliers choose what to make. TrendForce expects HBM contract prices to "surge multiples higher in 2027" and says suppliers will divide production between HBM and regular DRAM according to how those HBM negotiations turn out. If AI customers keep outbidding everyone else, more wafers will move toward them.

How long the shortage could last

This is where the forecasts get uncomfortable for consumers. Mehrotra said Micron expects supply and demand to be "much tighter in fiscal 2027 and 2028 than they were in 2026." He added that the company has no line of sight to when the market returns to balance. Micron's CFO, Mark Murphy, expects industry DRAM bit shipments to grow by only about the low 20s percent in both 2027 and 2028.

The obvious fix is new factories, and new factories take time. "Clean rooms take a long while to build," Mehrotra said, and output ramps gradually even after the first wafers come out. SK hynix says its Yongin Phase 1 cleanroom opens in early 2027, and it's speeding up production at its M15X fab. Those are plans, not delivered capacity, and they will be competing for AI demand from the day they open.

The market researchers broadly agree. IDC's PC team expects no meaningful relief before the end of 2027 and says prices are unlikely to return to 2025 levels even after supply catches up. Its phone team expects memory constraints to last through 2028, with the market stabilizing only after that. These are forecasts, and both firms have repeatedly revised them in the wrong direction over the past year. But none of the major voices here is predicting a quick reversal.

What to watch next

TrendForce's contract price updates over the coming months will show whether this quarter's slowdown continues or the next round of HBM deals reverses it. SK hynix and Samsung usually report third-quarter results in late October, and their comments on 2027 HBM pricing will show how much capacity stays tied up in AI. Micron's next report, likely in December, will test its $61.5 billion forecast.

The holiday season will show it most directly: the base memory on sale laptops and the price of an entry-level phone. If AI data centers keep winning the bidding war, would you rather pay more for the memory you wanted, or settle for less and trust the cloud to pick up the slack?