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AI's insatiable demand for HBM will drive up prices for all electronics, not just smartphones, in 2026

Published: 02 Jan. 2026, 16:32 Updated: 05 Jan. 2026, 10:14

Samsung Electronics President Roh Tae-moon holds up Galaxy S25 Series phones during the Galaxy Unpacked 2025 event at SAP Center in San Jose, California on Jan. 22, 2025. [SAMSUNG ELECTRONICS]

As demand for semiconductors surges amid the spread of AI, prices for smartphones, home appliances and other consumer electronics are rising. Samsung Electronics’ upcoming flagship smartphone, the Galaxy S26 series, set to launch in February, may no longer be able to uphold the company's price freeze policy.

The Financial Times reported on Thursday that prices for key electronics such as smartphones, computers and appliances could increase by as much as 5 to 20 percent this year.

This is due to soaring demand for HBM used in AI data centers, which is pushing general-purpose DRAM production down the priority list, leading to both supply shortages and price hikes.

Jeff Clarke, chief operating officer of U.S. PC maker Dell Technologies, said during an earnings call in November last year that this production decrease isn’t just limited to DRAM — demand is outstripping supply across NAND flash memory, hard drives and the entire semiconductor network.

Despite steep price hikes, the share of memory components in electronic devices continues to grow as AI features expand, deepening manufacturers’ concerns.

Memory is expected to account for more than 20 percent of laptop manufacturing costs this year, up from the previous range of 10 to 18 percent, driven by the integration of AI functions, according to semiconductor research firm TrendForce.

Samsung Electronics' GDDR7, a next-generation graphics DRAM optimized for gaming and AI workloads, is on display during the 2025 Korea Tech Festival in Seoul on Dec. 4, 2025. [REUTERS/YONHAP]

Samsung Electronics, which plans to unveil new smartphones in February, is facing mounting pressure. Market research firm Counterpoint Research predicted in a report last month that memory prices for smartphones will rise an additional 40 percent by the second quarter of this year.

As a result, smartphone production costs are projected to increase by 8 to 15 percent, while average selling prices are expected to rise 6.9 percent year on year.

Samsung has frozen domestic retail prices for its Galaxy S series for two consecutive years starting in 2024. But with rising prices for core components, the industry believes maintaining that policy this year will be difficult.

Crowds are seen during the Galaxy Unpacked 2025 event at SAP Center in San Jose, California on Jan. 22, 2025. [SAMSUNG ELECTRONICS]

Last year, the Galaxy S25 base model was priced at 1.15 million won ($800), the S26 Plus at 1.35 million won and the S26 Ultra at 1.7 million won — all for the 256-gigabyte versions.

Global tech firms have already begun raising prices. Xiaomi, which has built its brand around cost-effectiveness, has raised the price of its recently released Xiaomi 17 Ultra by about 10 percent compared to its previous model. Dell raised prices for major products by 15 to 20 percent starting mid-December.

Taiwanese PC makers Asus and Acer have also signaled that they plan to reflect the spike in memory costs in their PC prices.

This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.
BY YI WOO-LIM [[email protected]]