Why Are RAM Prices So High Right Now?

The price of RAM has skyrocketed over the last 18 months, leaving consumers facing a significant financial burden. The rise in RAM prices is not only affecting the cost of new devices but also impacting the overall performance and functionality of existing systems.

Source: engadget.com

So, what’s behind this sudden surge in RAM prices? The answer lies in the rapidly growing demand for artificial intelligence (AI) and the resulting increase in the production of high-performance computing equipment.

A Brief Overview of RAM

RAM, or Random Access Memory, is a crucial component of every computer, enabling it to read and execute data effectively. In order to work, your CPU needs a steady supply of information to process, which is stored on its hard drive. However, no matter how fast your hard drive is, it’s still not going to be fast enough to feed data to the CPU quickly enough for it to do its job properly.

That’s where RAM comes in, sitting between the CPU and hard drive, pulling files from storage and holding them ready for the CPU to do its job. The more RAM you have, the more data can sit, coiled like a spring, ready to leap into action.

The RAM Market

There are essentially three companies making the majority of the world’s RAM: Samsung, SK Hynix, and Micron. Each one operates manufacturing plants worth billions of dollars, executing the sorts of precision engineering that even rocket scientists think is tough.

RAM is the catch-all term for the technology, and aside from some hyper-specific uses like CPU caches, DRAM is what you’ll find in consumer electronics. DRAM comes in many flavors, including DDR (Double Data Rate) for PCs and Low Power DDR (LPDDR) for mobile devices.

But there’s another type of RAM called HBM (High Bandwidth Memory), which is designed for high-end computing environments. HBM is more advanced, a lot faster than standard DDR, and packs in far more memory than you’d find on a standard stick of DRAM.

The speed and capacity advantages HBM has makes it ideal for intensive workloads, which is why it’s found in data centers and used for AI training.

AI and the RAM Crisis

AI companies have convinced both the political and investor class that their products are an existential requirement. Companies like OpenAI are on a war footing, given billions of dollars and told to outspend their rivals to build out as much computing power as it can.

They used a lot of that largesse to buy out entire years’ worth of hardware capacity from the factories. DigiTimes claims that every manufacturer’s 2027 RAM capacity has already been sold out.

To understand how disruptive the AI bubble has been to the rest of the industry, it might help to look at the impact of just one data center. xAI’s Colossus site in Memphis, according to infrastructure company Introl, has 555,000 NVIDIA GPUs worth $18 billion training Elon Musk’s AI.

Colossus reportedly is fitted out with maximum RAM allocation, NVIDIA Grace Blackwell 200, NVIDIA Grace Blackwell 300, NVIDIA H100/H200 Tensor Core, and 80GB/94GB (H100) and 141GB (H200).

If that’s the case, then this one facility could be using as much as 112,005,000 GB of RAM. And while the RAM in these facilities couldn’t be put into consumer devices, it’s using the same resources.

That amount of RAM is equivalent to the RAM in 14,000,625 iPhones 17 or 9,333,750 Galaxy S26s.

A Bloomberg report from March claims there are 831 of these sites currently under construction.

For more evidence that this is going to get worse, look at the deal OpenAI signed with AMD back in October 2025. The pair pledged to build out 6GW of AI data centers, with the first 1GW site using AMD’s Instinct MI450 GPUs.

That GPU has a maximum RAM capacity of 432GB. If we use the rule of thumb that around 450,000 GPUs shake out to around 1GW of capacity, then this project alone could use up to 194,400,000 GB of RAM (or about 24.3 million iPhone 17 units).

When Will RAM Prices Come Back Down?

These days, nobody knows, and the price of RAM could sink dramatically if the AI bubble bursts ahead of schedule.

However, even if that doesn’t happen, the best people to ask are those who actually make the stuff, and they don’t think it’ll be quick.

In an interview with Reuters, SK Hynix CEO Kwak Noh-jung says things are going to get worse in 2027. If the DigiTimes report is accurate, then every piece of RAM may already be accounted for.

Speaking to investors in June, Micron CEO Sanjay Mehrotra said he expects to see ‘tight conditions to persist beyond calendar 2027 [2028].’

High-minded finance types feel the same, and Deloitte says we shouldn’t see any relief from the crisis until 2030 at the very earliest.

Why Can’t Micron, Samsung, and SK Hynix Just Make More RAM?

AI companies boast that they can spin up a data center in a matter of months, but building a new RAM factory is not quite as simple.

It’s expensive, time-consuming, and requires plenty of precision tooling, training, and equipment.

Here’s an example: Micron’s facility in Boise, Idaho has a class one clean room, which has no more than one particle of dust in a cubic foot of air.

A new RAM facility takes billions of dollars and years of development, so don’t expect anyone to lash up a new production line in a warehouse somewhere.

SK Hynix has committed to building two new memory factories in South Korea at a combined cost of $38.1 billion, with production expected to begin in June 2029 at the very earliest.

And then there’s the rather less convenient fact that Micron, Samsung, and SK Hynix aren’t in too much of a hurry to see the end of this crisis.

HBM is far more profitable than DRAM, and AI hyperscale companies will pay top dollar to secure what limited supply is available.