Key facts
- Samsung forecasts the current RAM chip shortage to worsen through 2027 and continue until at least 2028.
- Demand from AI labs is driving the shortage, with companies sharing long-term forecasts to secure supply.
- Samsung's semiconductor unit achieved record sales in Q2 due to increased chip prices.
- Higher component costs have impacted profitability in Samsung's smartphone and TV divisions.
- Apple has also raised prices on its Mac products due to the chip shortage.
Samsung anticipates that the current shortage of RAM chips will not only continue into next year but is likely to intensify by 2027, with tight supply conditions persisting until at least 2028. The company, which supplies approximately one-third of the global memory chip market, stated in its second-quarter earnings call that leading AI laboratories are directly sharing their medium- to long-term demand forecasts to secure future supply.
This high demand allows Samsung to prioritize customers willing to commit to long-term contracts. Such multi-year visibility will enable the company to invest in equipment and expand production capacity, aiming to mitigate the historical boom-and-bust cycles characteristic of the memory industry. The AI-driven memory shortage has also led to increased chip prices in recent months.
While Samsung's semiconductor division reported record sales in Q2, the higher chip costs negatively impacted profitability in its smartphone and TV divisions. Consequently, Samsung has passed some of these increased component costs onto consumers through higher prices for its Galaxy smartphones and tablets, which has led to a reduction in demand for these devices. Apple, a key competitor, has also increased prices for its Macbooks, Macs, and iPads, and has warned of slower revenue growth in the upcoming quarter.
With memory manufacturers redirecting production capacity towards AI data centers away from consumer electronics, consumers are facing higher prices for devices. Nvidia is also expected to raise prices for its consumer graphics cards, potentially further increasing the cost of gaming devices, computers, and laptops.