AI-Driven Surge in Memory Demand Sparks Worsening Global Chip Shortage

The explosive growth in AI datacenters, particularly the extensive purchase of Nvidia accelerators equipped with high bandwidth memory (HBM), is driving a significant global shortage of DRAM chips, causing prices to surge and production bottlenecks across industries. Prices for certain DRAM types have jumped by 75% between December and January, reflecting the tightening supply amid manufacturers like Samsung, SK Hynix, and Micron shifting production toward AI-focused memory. Industry leaders such as Apple CEO Tim Cook and Tesla's Elon Musk have sounded alarms — Cook warned the shortage could squeeze iPhone margins, while Musk suggested that Tesla might need to develop its own semiconductor factory. Analysts and executives, including Micron Technology, describe the current memory bottleneck as the most severe in decades, projecting the shortage to persist throughout 2026. The ripple effects extend beyond AI and consumer electronics, impacting automotive production, telecoms, and gaming; Sony and Nintendo are reportedly reconsidering product launch timelines and pricing. Hyperscalers like Alphabet, Microsoft, Amazon, and Meta drive the demand surge as they expand AI datacenter capacities, with TrendForce estimating a 70% rise in HBM demand by 2026, representing nearly a quarter of DRAM wafer production. While chip makers currently enjoy higher margins, the shortage raises costs for manufacturers and consumers alike, signaling an ongoing semiconductor supply crisis.