Samsung Warns of Worsening Memory Shortage in 2024, Anticipate Higher Tech Prices

The cost of modern gaming tech, from consoles to PCs, has surged over the past couple of years, largely due to ongoing memory shortages driven by the demands of AI hyperscalers. If you were hoping for a turnaround by 2027, brace yourself for some disappointing news. Samsung, a major player in the memory chip market, predicts that conditions will worsen next year.

In a recent earnings call, Samsung revealed that AI companies and research labs have been sharing their medium- to long-term demand forecasts with them, hoping to secure a steady supply of chips. This insight has led Samsung, which accounts for about a third of the global memory chip supply, to anticipate an even greater demand for memory in 2027. This spike in demand is expected to exacerbate supply issues and likely result in further price hikes for tablets, PCs, consoles, and smartphones. Samsung also indicated that the high-demand, low-supply scenario is expected to persist at least until 2028.

The ongoing DRAM shortage, often dubbed “RAMageddon,” has been a key factor behind the tech price increases we’ve seen over the last 16 months. Prices for Xbox and PlayStation consoles have hit all-time highs, while Apple has raised prices on its budget devices and introduced pay-later options. Even retro and kid-friendly mini-consoles are experiencing price hikes as companies like Valve struggle to keep pace with the demands of AI hyperscalers and data center builders.

For Samsung, this situation is proving to be quite lucrative. While its consumer device sales may not be as strong as they once were, the company is raking in profits by focusing on larger clients who are locking in long-term contracts for memory chips. If companies like Valve choose not to engage with Samsung or other memory manufacturers at these elevated prices, they risk losing access to essential RAM altogether. Unfortunately, it seems this challenging landscape is only set to worsen in the coming year.