Samsung Expects the Chip Shortage to Get Worse Before It Gets Better

Don’t expect lower prices on tech anytime soon.  That’s the takeaway from what Samsung execs said on the company’s second-quarter earnings call Thursday. The company expects the memory chip shortage behind rising tech prices to continue through 2028.  The RAM shortage, sometimes dubbed RAMageddon, is driven by high demand for memory (and low supply) driven by the rapid growth of AI and demand for the chips that power all those data centers. That means the chips for your devices like laptops and smartphones are costing manufacturers more.  Jaejune Kim, Samsung’s executive vice president of memory, broke down what the supply and demand in the memory market means for Samsung in the Q2 earnings call. Kim said that the rapid adoption of agentic AI has led to increased demand and use of AI servers and overall computing. And AI frontier model developers are struggling to get enough cloud capacity. Other factors are affecting memory supply and demand, including AI developers seeking to meet their memory needs through Samsung — even aiming for multiyear supply agreements where possible. That means the company has a sense of the longer-term demand for memory. “So we believe it will be unlikely to see any significant increase in incremental supply through 2028. Based on the incoming requests that we have been seeing from the customers, unmet demand from this year is likely to carry over into the following year, contributing to tighter supply conditions going forward. The supply constraints are expected to become even more severe in 2027 than 2026, reinforcing our view that the supply shortage will persist through 2028,” said Kim.  Thinking beyond into 2029 is hard to say due to limited visibility, Kim added.  Daniel Araujo, Samsung’s vice president of mobile experience, said the demand for AI servers is also driving the mobile memory shortage and the resulting high prices. That demand won’t slow down anytime soon, either. Samsung hopes that sales from the S26 series and new premium products, such as the Tab S12 foldable series and the Watch Ultra 2, will boost profits.  Samsung didn’t say whether we should expect higher prices in the future, but some new products revealed at Samsung Unpacked already cost more than earlier models, like the $1,200 Galaxy Z Fold 8. The memory chip shortage has already led to other big-name tech companies, including Apple and Microsoft, to increase prices on new and existing products.  Dashia Milden Editor Dashia is the consumer insights editor for CNET. She specializes in data-driven analysis and news at the intersection of tech, personal finance and consumer sentiment. Dashia investigates economic shifts and everyday challenges to help readers make well-informed decisions, and she covers a range of topics, including technology, security, energy and money. Dashia graduated from the University of South Carolina with a bachelor's degree in journalism. She loves baking, teaching spinning and spending time with her family. See full bio The Latest from Dashia Samsung Expects the Chip Shortage to Get Worse Before It Gets Better CNET Readers Are Convinced Apple Has a Foldable iPhone Coming. But What About Smart Glasses? EU Slaps Google With $1 Billion Fine Over Search and Play Store Computing Guides Laptops Best Laptop Best Chromebook Best Budget Laptop Best Cheap Gaming Laptop Best 2-in-1 Laptop Best Windows Laptop Best Macbook Best Gaming Laptop Best Macbook Deals Desktops & Monitors Best Desktop P