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Smartphone prices face upward pressure as memory suppliers prioritise demand from AI data centres, but a rise is not guaranteed for every phone. Gartner forecast in February 2026 that average smartphone prices would be 13% higher in 2026 than in 2025. That is a market forecast—not a confirmed increase for any particular brand or model—and phone makers may also respond with fewer discounts, lower specifications or fewer budget models.
Why data-centre AI demand can affect phones
AI accelerators rely on high-bandwidth memory (HBM), while data centres also use large quantities of server DRAM and enterprise solid-state storage. Smartphones use different products: low-power DRAM such as LPDDR4X, LPDDR5 or LPDDR5X, plus NAND flash packaged with a storage interface such as UFS.
That distinction matters. The issue is not simply that AI servers and phones need identical memory chips. Rather, they draw on an overlapping manufacturing ecosystem: wafer capacity, investment, packaging resources and supplier attention. When memory makers allocate more capacity to high-demand, higher-margin HBM and server products, supply of conventional DRAM and NAND can tighten too. IDC describes AI data-centre demand as competing with consumer-device requirements across this broader ecosystem (IDC’s analysis of the 2026 memory market).
The cost pressure then reaches handset makers through memory prices and supply allocations. A manufacturer may absorb the increase, charge more, change a phone’s configuration, delay a launch or reduce production. Which response it chooses depends on the model, its contracts and inventory, and the company’s pricing strategy.
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What the forecasts and suppliers say
Gartner’s February 26, 2026 forecast put three figures in perspective: combined DRAM and SSD prices could rise 130% by the end of 2026; average smartphone prices could rise 13% compared with 2025; and global smartphone shipments could fall 8.4%. These are forecasts for different measures. The 130% figure does not mean phones will cost 130% more, and the 13% average does not predict the price change for each handset (Gartner’s forecast).
Supplier reports support the idea that AI demand is affecting memory markets. Samsung said in its second-quarter 2026 results that AI infrastructure investment was supporting robust demand for HBM, server DRAM and enterprise SSDs, with memory prices contributing to stronger results (Samsung’s Q2 2026 results). Micron reported strong AI-related demand and said LPDDR5X production was ramping for smartphone customers. That is evidence of demand and production activity, not proof that a particular phone’s retail price will change (Micron’s Q3 fiscal 2026 results).
Other analysts forecast a weaker market, but their numbers should not be conflated. Omdia projected a 7% decline in global smartphone shipments in 2026, citing memory constraints and geopolitical pressures. Gartner’s shipment forecast is 8.4%; both are estimates, not final results, and the difference does not alter the central point that analysts expect pressure on supply and sales (Omdia’s outlook).
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- Entry-level phones: These are generally most vulnerable. Memory is a larger share of a low-cost device’s bill of materials, margins are thinner, and buyers are especially price-sensitive. Omdia has singled out entry-focused vendors that rely heavily on LPDDR4X as exposed to constraints and cost inflation. A cited estimate that memory can account for as much as 64% of the cost of some lower-tier phones is segment-specific, not a rule for all budget devices (Tom’s Hardware’s report on lower-tier phones).
- Mid-range phones: They face a difficult value trade-off. RAM and storage help distinguish models, but a higher price can push a phone toward a more expensive category. Cutting memory may preserve the price while making the phone less competitive.
- Premium phones: They are not immune, but larger purchasing volumes, stronger margins, brand pricing power and supply agreements can give major manufacturers more options to absorb or spread costs. High-storage configurations may be particularly sensitive because they contain more flash storage.
These are relative exposures, not predictions for every model. A specific phone’s outcome depends on its configuration, component contracts, stock already purchased, local exchange rates and market conditions.
Higher prices are only one possible outcome
Memory is just one part of a phone’s cost, alongside its processor and modem, display, cameras, battery, assembly, software support, logistics, marketing, warranty and retailer or carrier margins. A component-price increase does not pass through to the shelf price one-for-one.
Instead of raising a headline price, a manufacturer could:
- offer less RAM or storage for the same list price;
- raise prices only for certain storage tiers or regions;
- reduce launch discounts and trade-in promotions;
- use older-generation components where practical;
- cancel or delay less profitable models, or make fewer of them; or
- accept lower margins rather than immediately charging buyers more.
That is why “less phone for the same money” may matter as much as a visible price increase. A carrier installment plan or promotional offer can also make a higher underlying price less obvious, so compare the full device cost and the terms of any deal.
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When might buyers notice?
There is no single global date when phone prices will change. Existing retail stock may have been made or bought under earlier component terms. New production runs are more likely to reflect updated costs, while manufacturers with pre-booked supply may be buffered in the short term. Budget phones with shorter purchasing cycles could react sooner. New launches in the second half of 2026 and in 2027 may reveal pressures more clearly, but timing will vary by company and market.
Promotions can disappear before list prices move. A phone may therefore become more expensive to buy in practice even if its official price stays the same. Conversely, a retailer clearing old inventory or a carrier offering a subsidy can temporarily offset the pressure.
Should you buy now or wait?
Do not buy solely because of a forecast. Buy now if your current phone is failing, you need a replacement, or a model you want is already at a good price. A dependable discount on a suitable phone is more concrete than either a predicted price increase or a hope that prices will fall.
If your phone works well and a major launch is near, waiting may give you more options—but it does not guarantee a lower price. If you compare deals, look beyond RAM and the headline figure: check base storage, battery life, software-support period, camera quality, repair options, warranty, network compatibility and whether the storage can be expanded. A cheap base configuration can be poor value if it does not have enough storage for your needs.
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A last-generation premium phone or a manufacturer-certified refurbished model could be alternatives if new budget or mid-range phones become less attractive. Refurbished prices are not guaranteed to stay low: stronger demand for used devices could affect availability and pricing too. Check the seller’s warranty, battery condition, return terms and the exact configuration. For any phone, confirm local carrier bands, eSIM support and software availability.
Could memory costs ease?
Yes. Additional DRAM and NAND capacity, better production yields, weaker AI-server orders, more efficient AI systems, slower phone demand or an inventory correction could ease the squeeze. But new capacity takes time. IDC has described the shortage as potentially extending into 2027, while Micron has cited construction lead times and constraints including labor, permitting and energy infrastructure. Those are attributed outlooks, not a guaranteed end date (IDC; Micron’s June 2026 earnings-call transcript).
Even if component prices ease, phone retail prices may not fall immediately: manufacturers may first rebuild margins, clear inventory or adjust promotions. The timing and extent of any relief are uncertain.
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