AI-fueled chip shortage drives up smartphone prices

""The AI boom, along with the massive investments in infrastructure and data centers that come with it, is having a noticeable impact on the memory chip market," Wolfgang Weber, CEO of the German Electro and Digital Industry Association (ZVEI), told DW. "According to analyses by the World Semiconductor Trade Statistics (WSTS) institute, prices for these chips rose by 50% last year," Weber said. As a result, consumers may face not only longer delivery times but also higher prices for electronic and digital devices. "Bottlenecks in such key technologies pose a serious problem for our economy," the association's head warned. "The chip shortage alone between 2021 and 2023 caused more than 102 billion ($121 billion) in economic damage in Germany.""

"The latest figures from WSTS underscore the industry's rapid growth (see chart). In the first half of 2025, the global semiconductor market reached $346 billion (293 billion) an increase of 18.9% compared with the previous year. Overall, WSTS forecasts 22% growth for 2025, bringing the market to $772 billion. For 2026, it expects an even sharper rise of more than 25%, pushing the market to $975 billion."

""In a moderate scenario, average smartphone selling prices could rise by 3 to 5%," the study states. "In a pessimistic scenario, they could increase by as much as 8%." Experts warn of a turning point. The age of cheap, plentiful memory and storage is ending. In 2026, technology is set to become more expensive not because demand is booming, but because supply can't keep up."

Surging AI demand and massive investments in infrastructure and data centers are driving strong growth in memory chip demand and sharply higher prices. Analyses by the World Semiconductor Trade Statistics institute showed memory-chip prices rose by 50% last year, contributing to longer delivery times and higher consumer prices for electronic devices. Chip shortages between 2021 and 2023 caused more than €102 billion ($121 billion) in economic damage in Germany. WSTS data show the global semiconductor market reached $346 billion in H1 2025, with forecasts of $772 billion in 2025 and $975 billion in 2026. IDC projects smartphone prices could rise 3–5% moderately or up to 8% pessimistically.

Read at www.dw.com