Memory prices have soared so dramatically that even a chip giant like AMD is bracing for impact. During its first-quarter 2026 earnings call, the company warned that PC shipments will likely drop in the second half of the year directly because of the memory supply crisis. Budget models under $500 face the biggest squeeze, while corporate buyers have triggered an unusual buying spree by accelerating hardware refresh cycles. Understanding how memory costs pc shipments reveals a market that is splitting into two very different realities.
The Memory Supply Crisis Explained
Memory prices have more than quadrupled since last year for certain types of DRAM and NAND flash. That is not a minor adjustment. It is a seismic shift that ripples through every desktop and laptop sold today.
The root cause traces back to memory manufacturers reallocating factory capacity. Makers have shifted production lines toward high-bandwidth memory (HBM) and other AI server memory types. These components command far higher margins than the DRAM and NAND flash used in consumer PCs. When a factory can produce chips that sell for several thousand dollars versus chips that sell for a few hundred, the decision is straightforward. The result is a constrained supply for the memory that ordinary computers depend on.
Why Consumer Memory Got Squeezed
AI infrastructure spending has exploded. Data centers need vast quantities of HBM to run large language models and other AI workloads. Memory manufacturers see the revenue potential and have converted significant portions of their fabrication capacity to serve that demand. The unintended consequence is that the memory used in PCs — the DDR5 modules and solid-state drives that make a laptop run — now faces tighter supply and higher prices.
This is not a temporary hiccup. Industry forecasts suggest the imbalance could persist through at least early 2027. For anyone planning a PC purchase, the timing is unfortunate.
How Rising Memory Costs Impact PC Shipments
The link between memory costs pc shipments is direct and measurable. When a laptop requires $60 worth of DRAM instead of $15, the entire bill of materials changes. Vendors either raise prices or reduce margins. For premium machines, a $45 increase is absorbed relatively easily. For budget models under $500, that same increase can wipe out the profit entirely.
Analyst firm Gartner estimates that PC shipments will decline by more than 10 percent during 2026. That is a significant contraction for an industry that had been enjoying a steady recovery after the post-pandemic slump.
Budget Models Under $500 Face Disappearing Options
The worst affected category will be budget PCs. Vendors struggle to hit price points below $500 when memory costs consume a much larger share of the total component budget. Some manufacturers may simply stop offering certain low-cost models rather than sell them at a loss.
For a consumer looking to buy an affordable laptop for school, work, or basic home use, the options will narrow. The machines that remain may feature less memory or slower storage to compensate. A $450 laptop that previously included 8GB of RAM and a 256GB SSD might ship with 4GB of RAM and a 128GB drive at the same price point. Performance takes a hit, and the user may not understand why their new computer feels sluggish.
Price-conscious shoppers should be prepared to either raise their budget or accept compromises on memory capacity. Waiting for prices to drop could be a long wait.
Corporate Buying Spree Masks Consumer Weakness
The forecast price rises have triggered a buying spree among corporate customers. Organizations have brought forward planned hardware refresh cycles to purchase before costs climb higher. This is a rational response to a predictable price increase, but it creates a misleading picture of overall demand.
AMD reported that its Client and Gaming segment revenue rose 23 percent year-over-year to $3.6 billion. That sounds positive, but the figure includes the pull-forward effect of corporate buyers accelerating purchases. Once those buyers finish their accelerated cycles, demand may drop sharply.
CEO Lisa Su indicated that AMD expects second-half PC shipments to be lower due to higher memory and component costs. The company still projects client revenue to grow year-over-year overall, driven by its Ryzen portfolio and expanding commercial adoption. But the corporate surge may simply be borrowing demand from 2027 rather than representing genuine market expansion.
AMD’s Strategy and Secured Supply
AMD has not been caught off guard by the memory crisis. The company has secured enough memory supply to meet and exceed its own shipment targets. That is no small achievement when memory is scarce and expensive.
Su confirmed on the earnings call that AMD is working closely with memory providers to ensure that every CPU or GPU shipped is paired with appropriate memory. The goal is to avoid a scenario where compute hardware sits idle because the matching memory is unavailable.
“We are expecting that there could be some demand impact as a result of the memory price increases on things like the PC business in the second half of the year as well as the Gaming business,” Su said. “We’re taking that into account in our overall model.”
The Ryzen Portfolio Advantage
AMD’s Ryzen processors have gained traction in the commercial segment, and that momentum provides a buffer. Corporate IT departments increasingly specify Ryzen-based systems for their performance-per-dollar advantage. As businesses refresh their fleets ahead of memory-driven price hikes, AMD benefits disproportionately compared to competitors with weaker commercial presence.
The company is also focusing on premium segments of the market where memory cost increases are less painful. By emphasizing higher-margin products, AMD can protect its revenue even if unit volumes decline.
Gaming Revenue Expected to Drop More Than 20 Percent
Gaming represents a particularly exposed segment for AMD. CFO Jean Hu confirmed that second-half gaming revenue would decline more than 20 percent compared to the first half. Memory costs are the primary culprit.
Gaming PCs and consoles require substantial amounts of high-speed memory. A modern gaming rig typically includes 16GB or 32GB of DDR5 RAM, plus a fast SSD for storage. When memory prices quadruple, the cost of building a capable gaming machine rises by $100 or more. For a market already sensitive to price increases, that is enough to push some buyers to delay purchases or downgrade their specifications.
The Console Connection
AMD supplies custom chips for gaming consoles, including the PlayStation and Xbox families. Console manufacturers operate on thin margins and long product cycles. A memory cost increase of this magnitude directly pressures their ability to maintain existing price points. Whether console prices rise in response remains an open question, but the economics are challenging.
For PC gamers building their own systems, the advice is straightforward: buy memory now if you need it. Waiting for prices to normalize could mean paying more later. The current trajectory points upward, not downward.
What This Means for Different Buyers
The impact of rising memory costs pc shipments varies depending on who you are and what you need. Let us break it down by scenario.
The Budget Shopper Looking for a Laptop Under $500
This buyer faces the most difficult situation. The affordable laptop market is shrinking as vendors struggle to hit low price points. A consumer who needs a basic machine for web browsing, email, and document editing may find fewer options and weaker specifications than expected.
The practical solution is to act quickly if you see a good deal. Prices are more likely to rise than fall in the near term. Also consider buying a refurbished or previous-generation model, which may already include adequate memory without the price premium of current inventory.
The IT Procurement Manager at a Mid-Sized Company
Organizations that have not yet completed their hardware refresh cycles should consider accelerating purchases. The corporate buying spree is real, and prices will likely continue climbing through the second half of 2026. Securing pricing for bulk orders now could save significant money compared to purchasing in six months.
Working with vendors to lock in memory allocations is also worth exploring. AMD has shown that advance planning pays off. The same principle applies at the procurement level.
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The Gamer Planning a New Build
Gamers face a painful trade-off. Building a new rig now means paying elevated prices for memory. Waiting might bring relief, but there is no guarantee that prices will drop anytime soon. Memory manufacturers show no sign of reversing their AI-focused capacity allocation.
A pragmatic approach is to buy memory immediately while locking in current prices for the rest of the build. Alternatively, consider a build that uses slightly less memory — 16GB instead of 32GB — and plan an upgrade when prices eventually normalize.
Will Memory Prices Stabilize?
The outlook depends on memory manufacturers’ willingness to rebalance capacity between AI server memory and consumer PC memory. There is some reason for cautious optimism. High-bandwidth memory production yields are improving, which may free up some factory capacity for DRAM and NAND flash over time.
But structural demand for AI infrastructure shows no signs of slowing. AMD reported overall Q1 revenue of $10.25 billion, up roughly 38 percent year-over-year, driven primarily by AI infrastructure demand. As long as data center spending continues to grow, memory makers will prioritize HBM over consumer-grade memory.
The Timeline Question
If the memory shortage extends into 2027, the implications for PC buyers become more serious. Upgrade plans will need to account for persistently higher component costs. Corporate IT refresh cycles, which typically run three to four years, may need to extend to five years to avoid peak pricing.
For individual consumers, the decision to buy now or wait becomes a bet on market dynamics. Buying now locks in known pricing. Waiting risks paying even more later if the shortage deepens. The safer bet is to purchase when you find a fair price rather than trying to time the bottom.
Broader Implications for the PC Industry
The current situation highlights a structural vulnerability in the PC supply chain. The industry depends on memory manufacturers that serve multiple markets with vastly different economics. When AI infrastructure pays a premium, consumer PCs take a back seat.
This dynamic may persist for years. PC vendors and chipmakers like AMD will need to adapt by offering more configurations with less memory, developing memory-efficient technologies, and building deeper partnerships with memory suppliers to secure allocation.
The corporate buying spree has provided temporary relief, but it cannot last forever. Once organizations complete their accelerated refresh cycles, demand from that segment will normalize. At that point, the underlying weakness in consumer PC demand will become more visible.
A Two-Speed Market Emerges
We are witnessing the emergence of a two-speed PC market. On one side, the premium and commercial segments continue to grow, driven by corporate procurement and demand for high-performance computing. On the other side, the budget and consumer segments shrink as rising memory costs pc shipments of affordable models.
This split has implications for everyone involved. AMD is positioning itself to serve the premium and commercial segments where it has strong products and relationships. Budget buyers, meanwhile, will need to adjust their expectations or find alternatives.
The coming quarters will test whether the PC industry can navigate a period of constrained supply and elevated costs without leaving price-sensitive customers behind. For now, the message from AMD is clear: memory costs are reshaping the market, and the effects are only beginning to surface.
Practical Steps for Navigating the Memory Cost Crisis
Whether you are buying a PC for yourself or managing fleet procurement for an organization, a few strategies can help mitigate the impact of rising memory costs.
Buy Sooner Rather Than Later
If you have a planned purchase within the next six to twelve months, consider moving it forward. Prices are projected to rise, not fall, through the second half of 2026. Accelerating a purchase by even a few months could save a meaningful amount on the total cost.
Consider Alternative Configurations
Review whether you truly need the maximum memory configuration. For many users, 8GB of RAM remains sufficient for everyday tasks. Gamers and content creators may need 16GB or 32GB, but downgrading by one tier can offset price increases without a noticeable performance drop in most workflows.
Explore Refurbished and Previous-Generation Hardware
The corporate buying spree will eventually produce a wave of used and refurbished equipment as companies replace their fleets. Buying a business-class laptop from a previous generation can deliver excellent performance at a fraction of the cost of new hardware, often with adequate memory already installed.
Lock in Pricing with Vendors
For organizations, negotiating fixed pricing for memory-rich configurations over a defined period can provide budget certainty. Vendors are often willing to lock in rates for volume commitments, especially if approached before the next round of price increases takes effect.
The memory crisis is not something any individual buyer or company can solve alone. But by understanding the forces at work and planning accordingly, it is possible to make smarter purchasing decisions in a challenging market. AMD’s warning is a signal for everyone to pay attention and act with intention.
