The global memory market is currently facing a severe shortage, driven by the massive demand for high-bandwidth memory (HBM) used in AI infrastructure. According to Counterpoint, three manufacturers—Samsung, SK Hynix, and Micron—control approximately 90 percent of the market. In the second quarter of 2026, Samsung held a 39 percent share, followed by SK Hynix at 26 percent and Micron at 25 percent.
The production of HBM is significantly more resource-intensive than conventional DRAM, requiring roughly three times as many silicon wafers to produce the same volume. As a result, manufacturers are prioritizing long-term contracts with major AI players like Nvidia, AMD, Meta, and Microsoft. This shift has led to a sharp rise in component costs, with the price of 16GB of smartphone DRAM increasing by more than 300 percent between the second quarter of 2025 and 2026.
To address the supply gap, Micron is investing over $25 billion this year to expand capacity. The company is constructing a massive facility in New York, which will feature 2.4 million square feet of cleanroom space. Despite these efforts, the project is a long-term undertaking; Micron does not expect meaningful output from the site until 2030, with the entire process from permitting to production spanning approximately six years.
Industry analysts at Counterpoint and IDC do not anticipate a balance between supply and demand until late 2027 or early 2028. In the meantime, consumer electronics companies are responding to rising component costs by increasing retail prices. Microsoft has raised prices for Xbox consoles and Surface devices, while Meta increased the cost of its Quest 3 headset. Apple is also facing pressure to adjust pricing for its upcoming iPhone lineup.
