AI Boom Triggers Computer Component Price Surge Across Global Markets
Computer Component Price Surge Deepens in Early 2026
The global computer component price surge has intensified sharply in early 2026, with memory and storage products recording some of the steepest increases seen in over a decade. Prices for DRAM, NAND flash, and solid-state drives have doubled in several markets since mid-2025, reflecting a structural shift in demand driven by artificial intelligence infrastructure.
In India, consumer-grade 1TB SSD prices have risen from ₹8,000–₹9,000 in mid-2025 to ₹15,000–₹17,000 by January 2026, mirroring similar trends across Asia, Europe, and North America. Industry data indicates that this escalation is not the result of short-term shortages, but a sustained reallocation of semiconductor capacity toward AI-centric products.
Memory and Storage Prices Lead the Inflation Wave
Memory components have borne the brunt of the surge. Contract prices for DRAM rose 55–60 per cent quarter-on-quarter in Q1 2026, following a 171 per cent year-on-year increase during 2025. NAND flash memory prices also climbed sharply, rising 33–38 per cent quarter-on-quarter, with certain supply contracts recording cumulative hikes exceeding 200 per cent over the past year.
Client SSD prices, which depend heavily on NAND supply, increased by more than 40 per cent, while hard disk drives recorded price increases of nearly 46 per cent since September 2025. Spot prices for DDR5 memory have quadrupled in less than six months, driven by depleted inventories and aggressive procurement by hyperscale data centre operators.
PC and laptop manufacturers including Dell, HP, Lenovo, Acer, and Asus have already announced 15–20 per cent price increases from the second half of 2026, citing sustained component cost pressure.
AI Infrastructure Driving Unprecedented Demand
The primary driver behind the computer component price surge is the explosive expansion of AI infrastructure. Large-scale data centres operated by companies such as Google, Microsoft, Amazon, and Meta are consuming unprecedented volumes of advanced memory.
AI servers require significantly more memory than traditional enterprise or consumer systems. High-bandwidth memory (HBM), essential for AI accelerators, consumes nearly three times the wafer capacity of conventional DDR5. Industry estimates suggest that AI workloads alone may account for around 20 per cent of global DRAM wafer capacity by 2026.
This demand is structural rather than cyclical. Unlike previous semiconductor upcycles, which were driven by consumer electronics or short-term inventory corrections, AI investment is being locked in through multi-year capital expenditure commitments.
Manufacturing Shift and Constrained Supply
On the supply side, leading manufacturers including Samsung, SK Hynix, and Micron have deliberately redirected capacity toward higher-margin AI memory products. SK Hynix, now holding roughly 36 per cent of the global DRAM market, has prioritised HBM output over consumer-grade modules.
As a result, supply growth for traditional DRAM and NAND remains constrained. Forecasts for 2026 indicate DRAM supply growth of only around 16 per cent year-on-year, while NAND output is expected to expand by approximately 17 per cent, both below historical averages.
Inventory levels across the supply chain remain historically low following aggressive drawdowns during 2025, leaving little buffer against demand shocks.
Limited Relief Expected Before 2027
Looking ahead, industry projections suggest that the imbalance between demand and supply may persist through 2027 and potentially into 2028. New fabrication facilities require two to three years to become operational, limiting near-term relief.
Although incremental capacity additions from Samsung and Micron may ease pressure marginally in the second half of 2026, prices for DDR5 memory could still rise 30–50 per cent per quarter through mid-2026. In downside scenarios, prolonged component shortages could trigger a 4.9–8.9 per cent contraction in global PC shipments.
Advanced manufacturing capacity at nodes of 7nm and below is expected to grow significantly by 2028, but AI demand growth continues to outpace even these expansions.
Global Trade and Geopolitical Implications
The AI-led computer component price surge is also reshaping global trade dynamics. The United States, which produces only about 10 per cent of its semiconductor needs, has increasingly framed chip dependency as a national security risk.
Tariffs, export controls, and supply-chain localisation initiatives are adding further cost pressures. Trade restrictions on advanced lithography equipment and AI-enabling technologies could create significant bottlenecks, affecting a semiconductor market increasingly valued in the trillions of dollars.
For import-dependent economies such as India, the combination of global shortages and trade fragmentation is likely to amplify hardware inflation, particularly for consumer electronics.
What Lies Ahead for Consumers and Industry
The ongoing surge underscores a fundamental shift in the semiconductor ecosystem. AI workloads now dominate allocation decisions, pushing consumer electronics down the priority list. With prices expected to remain elevated well into 2027, manufacturers and buyers may be forced to adjust purchasing cycles, delay upgrades, or explore alternative configurations.
For policymakers and industry leaders, the lesson is clear. Capacity expansion, supply diversification, and long-term planning will be essential to prevent AI growth from distorting broader access to computing technology.
