Smartphone price hikes have been widely predicted for months, but 2026 is now shaping up to be the year those warnings turn into reality. Analysts, leaks, and supply chain reports have all been pointing out how this year will be uniquely bold and worrisome for phone buyers.
Now, Nothing CEO Carl Pei has laid out why smartphone prices are rising and why there may be no easy way around it. In a long post on X, Pei said the smartphone industry is facing a shift it has not seen in more than a decade, and it all comes down to memory.
“For fifteen years, the smartphone industry relied on a single, reliable assumption: components would inevitably get cheaper,” he wrote. That assumption, according to Pei, has finally collapsed due to a sharp and unprecedented rise in memory costs.
Why memory is suddenly the biggest problem
Pei explains that AI has completely reshaped demand for memory chips. The same memory used in smartphones is now critical for AI data centers, and hyperscalers are locking in silicon wafer capacity years in advance. “For the first time, smartphones are competing directly with AI infrastructure,” he said, and RAM prices are climbing fast as a result.
In some cases, Pei claims memory costs have already risen by up to three times, with more increases expected. He points out that memory modules that cost less than $20 a year ago could $100 by the end of 2026 for top-tier phones. That shift forces phone makers into an uncomfortable choice: either raise prices by 30% or more, or downgrade specs.
We are already seeing signs of this across the industry, from reports warning that your next Galaxy smartphone could cost more, to analysis showing how rising memory costs could directly impact your next smartphone purchase from any other brand.
This is not just a smartphone problem. Any product that relies heavily on memory is affected. Laptops and PCs are already seeing price pressure, with reports showing RAM and storage prices climbing fast, and brands like Dell and Lenovo signaling upcoming price hikes, while Asus has also joined the growing list of PC makers raising prices.
Even memory suppliers are sounding the alarm, with Micron confirming that the memory shortage and pricing pressure are here to stay. Due to AI race, the era of cheap phones may be ending, with entry-level and mid-range segments likely to shrink as costs climb.
Pei agrees, saying brands that built their reputation on offering more specs for less money will struggle. Nothing itself plans to raise prices across its lineup, especially as it upgrades products launching this quarter to UFS 3.1 storage.
Still, Pei sees an opportunity. He argues that 2026 marks the end of the specs race and the start of something else. With raw hardware no longer cheap, user experience, design, and how a phone feels to use will matter more than ever. In his words, the era of cheap silicon is over, and intentional design is just beginning.
