Reminiscence scarcity does not need to spell catastrophe for IT budgets

As AI infrastructure balloons, the tech business is going through a reminiscence scarcity anticipated to persist by 2027 and probably longer. Whereas information heart operators and hyperscalers with deep pockets are securing the reminiscence capability wanted to construct AI servers, their demand is outpacing provide. The shift is already driving value will increase throughout the IT market.

Because the likes of Microsoft, Google, Meta and Amazon snap up the vast majority of the worldwide silicon wafer capability, reminiscence producers — together with Samsung Electronics, SK Hynix and Micron Know-how — are prioritizing “higher-margin enterprise-grade parts,” in response to IDC. Consequently, there is a scarcity of wafers for mid-range smartphones and client laptops, and the price of these gadgets has elevated. 

Reminiscence shortages are driving up IT tools prices

The reminiscence scarcity is affecting IT tools pricing and availability — a shift that’s beginning to have an effect on CIO price range planning and infrastructure funding timing. Alvin Nguyen, senior analyst for Forrester, stated the reminiscence scarcity is having a big influence not solely on information heart and office tools but in addition “normal IT tools reminiscent of servers, storage, community, desktops, laptops, and workstation tools. This implies much less flexibility with machine configuration, tools shortages, and elevated prices — all of which we’re already seeing.” 

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The three main PC producers — Lenovo, Dell and HP — are already elevating costs this yr because of dynamic random-access reminiscence (DRAM) shortages. In the course of the firm’s fiscal yr Q1 earnings name, HP Interim CEO Bruce Broussard famous that rising costs of DRAM and NAND flash reminiscence are growing HP’s enter prices, and the corporate expects this “volatility” to proceed this yr and doubtlessly into fiscal yr 2027. The corporate’s CFO, Karen Parkhill, stated reminiscence prices have elevated practically 100% quarter-over-quarter. 

Reminiscence prices are solely growing as constrained manufacturing runs up in opposition to rising AI-driven demand. Samsung, which holds about 32% of the NAND market share, is anticipated to lift NAND costs by as a lot as 100% in Q2 after related will increase in Q1, successfully doubling costs this yr. Trying on the DRAM market, income elevated 51% yr over yr in Q3 2025 to $40.4 billion, analyst agency Omdia reported. 

“Proper now, the manufacturing is capped for this entire yr — it’s merely not doable to provide extra reminiscence, which signifies that it’s an outright pricing battle with the intention to safe that capability,” stated Runar Bjorhovde, a analysis analyst at Canalys. 

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How CIOs are adjusting to IT value will increase

To regulate their budgets in response to greater costs pushed by the reminiscence scarcity, CIOs can study lengthen the lifecycle of present infrastructure and delay refresh cycles, Bjorhovde stated. 

Nguyen echoed that view: “Reminiscence costs for some applied sciences are already 575% greater than final yr. For IT decision-makers, adjusting to amass methods with much less reminiscence or extending the tools lifespans are choices to attenuate the influence.”

Marc Hoit, CIO at North Carolina State College, stated the reminiscence scarcity is already affecting price range planning, and stated he’ll probably find yourself “shopping for much less tools.” His IT group is ” choices like extending the lifetime of present tools or re-using RAM,” he stated. He additionally famous that quotes for servers are coming again two or 3 times as costly as a month in the past — and are legitimate for just a few days, whereas a quote would sometimes be good for a month.

Along with extending the lifecycle of present {hardware} by upgrades or optimization efforts, CIOs could improve their use of cloud providers to entry capability with out relying as closely on bodily infrastructure, stated Terry White, affiliate chief analyst at Omdia. Vendor negotiations and partnerships may even turn out to be extra essential “to make sure precedence entry to restricted sources,” he added. 

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“Past budgets and procurement, CIOs might want to think about the potential ripple results on innovation and digital transformation initiatives. A chronic scarcity may decelerate the adoption of rising applied sciences that depend on high-performance reminiscence,” White stated. 

The influence is uneven throughout IT spending. Practically $6 trillion shall be spent within the IT market in 2026 globally, however gadgets — PCs, smartphones, and many others. — account for less than about $836 billion of that whole, in response to Gartner. Gadget spending is up 6% year-over-year. Server spending, by comparability, is anticipated to develop practically 37% year-over-year, whereas information heart spending is forecast to extend about 32% to greater than $650 billion.

Whereas the reminiscence scarcity is driving up IT tools prices, it is not hitting all spending classes equally. Units — among the many hardest hit  — account for less than about 14% of whole IT spend in 2026, with information heart methods at roughly 11%, in response to Gartner. This provides CIOs some flexibility in how they reply. 

In observe, that will imply delaying purchases of recent gadgets till the reminiscence market ranges out, whereas adjusting plans for servers and information heart capability — both consuming the upper prices or shifting some workloads to the cloud.

Some reduction to the reminiscence value spike may come as quickly as later this yr. The reminiscence market has traditionally been cyclical, which suggests a downturn is probably going on the horizon. 

“The large concern is when the AI bubble/market correction occurs,” Nguyen stated. “If a number of corrections occur this yr, then there shall be some instant reduction when it comes to pricing, though the shift to producing extra AI-targeted reminiscence (DDR5 and HBM) means the varieties of different IT gadgets that may take benefit could also be initially restricted.”