Memory prices will stay “crazy” through to at least 2027: Gartner

PC shipments likely to drop sharply this year thanks to the ongoing inflation of memory costs.

It’s no secret that the ever-increasing focus on AI-centric data centres has had a strong impact across the industry. The latest analysis from Gartner paints it in a rather stark way for the PC business especially.

According to Gartner’s latest memory costs report, combined DRAM and solid-state drive (SSD) prices will rise by an estimated 130 percent by the end of 2026. This will in due course lead to a spike in overall PC prices by 17 percent.

Gartner’s prediction here is that the rising cost of PCs will lead businesses to look to extend the end of life period for existing hardware by 15 percent.

That raises the spectre of older machines that may be harder to keep secure, especially if they’re running older or no longer supported operating systems.

One longer term effect of rising RAM and storage prices is, as per Gartner, the relatively rapid decline and death of the entry level PC space.

The rising cost of memory will be felt most strongly in this space due to already small margins being effectively obliterated by rising memory prices. Gartner predicts the obsolescence of the entry-level segment entirely by 2028, leaving the PC market to mid-range and predominantly premium machines instead.

The other knock-on effect of rising prices and businesses keeping older machines in production roles is likely to be one of slower than expected adoption of AI prices, with Gartner’s analysis pointing to 2028 as the likely timeframe for 50 percent market penetration.

Shrish Pant, director analyst at Gartner told CRN Australia that the supply issues surrounding memory supply have been clear for some time.

“We are in a situation where the demand has always exceeded supply for more than two years now. It has only accelerated over the last two quarters or so” he said.

Current in-market spot prices for memory are “just crazy” right now, according to Pant, with some buyers paying three to four times the prices they may have paid in the year prior.

The growth in hyperscalers using up available memory resources isn’t going away any time soon, either. Hyperscalers can afford higher memory prices, says Pant and “because of that, the larger share of DRAM going towards servers has increased from about 25, 26 per cent two years back, and is going to go above 40 per cent very soon.”

“That will be until the end of 2026 or early 2027, from a volume point, but from a value point, it's going to be even further out, because the memory, especially HBM memory, which goes into GPUs, is a lot more expensive.”

All of this is likely to lead to further increases in pricing.

“Prices are not coming down”, Pant noted. “For the next four quarters, they're only going to go up.”

So when might memory prices decline? Pant’s prediction is that prices may stabilise by Q1 2027, after which there may be a low level of decline, “in the second half of 2027”, though he did note that there could be some impact on memory pricing if conflicts in the Middle East continue for any expanded period of time.

If that happens, Pant predicts that “possibly we may see lesser capex commitment for AI data centres and the big funds in the Middle East that are funding them”.

“That would be a much bigger concern for memory vendors, because that impacts their high margin business, but we will only be able to see this after a couple of months”.

Gartner analysis has previously noted that AI, cybersecurity and cloud services are likely to be strong drivers of business investment in Australia in 2026.