A smartphone’s Bill of Materials (BoM) is estimated to rise by 25 percent in 2026 due to the DRAM crisis, with some manufacturers mulling bringing back 4GB RAM configurations for entry-level devices as costs have skyrocketed to astronomical levels. In addition to memory, NAND flash has also become expensive, with a research firm mentioning that the price of mobile LPDDR RAM has increased by more than 70 percent, with storage costs now 100 percent higher. With several companies scheduled to introduce their 2nm chipsets later this year, smartphones equipped with these SoCs and the aforementioned components are expected to blow a hole in the consumer’s wallet.
A separate analysis reveals that DRAM now accounts for more than 20 percent of a smartphone’s manufacturing costs
It is safe to say that no company is safe from the DRAM shortage, with Samsung’s co-CEO commenting that there’s no entity that can escape this crisis. Even a trillion-dollar giant like Apple has had to resort to desperate measures by reportedly sending its executives on long hotel stays overseas to secure deals with DRAM manufacturers Samsung and SK hynix, showing just how dire the situation is. According to research firm Omdia, with data shared by tipster Ice Universe, phone makers will face increased costs as they must pay DRAM and NAND flash price premiums of 70 percent and 100 percent, respectively.
In a separate analysis, TrendForce has noted that previously, memory accounted for between 10-15 percent of a smartphone’s total manufacturing cost, but this figure has risen to 20 percent. To make matters worse, chipsets like the Snapdragon 8 Elite Gen 6 Pro should easily cost upwards of $300 this year, as the Snapdragon 8 Elite Gen 5 is estimated to be priced at $280 per unit. Companies on the receiving end of these cost bumps are smartphone manufacturers, who will have to make extreme compromises regarding the specifications of their handsets, or pass the cost increases to consumers and risk lower sales.
It is indeed a slippery slope and an unavoidable one at that. However, not every company has to face the music of DRAM shortages, as NVIDIA explained how it managed to stay immune by prepaying for inventory to maintain the AI boom. Unfortunately, these moves were likely the catalyst for causing the shortage in the first place. Also, in case you were getting comfortable with the possibility that this crisis will conclude earlier, you’d better buckle up because the shortage is expected to persist until Q4 2027.
News Source: Ice Universe
About the author: Omar Sohail is a reporter and analyst for Wccftech's mobile section, specializing in the technology and business of the mobile industry. His expertise lies in the intricate hardware supply chain, covering developments in semiconductor manufacturing, chip lithography, and camera sensor technology.
Follow Wccftech on Google to get more of our news coverage in your feeds.
