The smartphone market has drawn renewed attention at the start of the year following a price adjustment announcement. OPPO's official store has issued a notice stating that from March 16, prices for some of its already-released products will be increased. The notice explicitly cites rising costs for key smartphone components, including high-speed storage hardware. This adjustment affects certain models from OPPO's A-series and K-series, as well as some devices from its sub-brand OnePlus. However, premium series such as the Find series, Reno series, and Pad series are not included in this initial price hike.
The price increases from OPPO and OnePlus are not isolated incidents. Prior to this, Samsung had already initiated a price rise. The Chinese variant of the Galaxy S26 series, released on February 25, saw the standard S26 model (12GB+256GB) increase by 1,000 yuan. The price of the S26+ (12GB+512GB) version surged by 1,600 yuan, rising from 7,999 yuan last year to 9,599 yuan. Even Xiaomi is feeling the pressure. Lu Weibing, President of Xiaomi Group, admitted that storage chip prices in the first quarter of this year are nearly four times higher than they were in the first quarter of last year. Lei Jun also recently stated publicly that the sharp rise in memory and storage prices is placing significant pressure on the smartphone business. Industry insiders view the AI boom as the primary catalyst behind this wave of price increases.
One industry participant pointed out that consumers may not readily accept these storage-driven price hikes, suggesting that both smartphone and PC manufacturers could suffer. He noted that rising storage costs are indeed the biggest challenge this year, with the most severe impact on devices in the budget segment. Multiple sources within the supply chain have confirmed that the procurement cost for smartphone storage chips is currently over 80% higher than the same period last year, with no signs of a slowdown.
The core source of this price surge points to a field that seems distant yet profoundly affects the consumer market: AI infrastructure development. With a global surge in demand for training and inference of large AI models, the need for high-performance storage chips in servers is growing exponentially. A supply chain source revealed that the current AI boom, combined with production cuts from suppliers, has significantly worsened the supply shortage of NAND flash memory. Major tech companies are aggressively investing in AI data center construction, leading to geometric growth in procurement demand for storage equipment, which directly supports the continuous sharp rise in NAND prices. The source stated that the price increases have exceeded industry expectations. Samsung Electronics plans to implement price hikes for its main NAND products in the second quarter similar to those in the first quarter. Given that prices were already raised by about 100% in the first quarter, a further 100% increase would mean NAND prices have tripled since the end of last year.
This price surge has significantly altered the cost structure of smartphones. According to IDC data, the proportion of memory semiconductors in smartphone costs has soared from the previous 10%-15% to over 20%, and even接近 30% for mid-range and budget models. Data from Counterpoint Research shows that compared to the fourth quarter of 2025, memory prices have surged by 80%-90% by the first quarter of 2026, with DRAM, NAND, and HBM all reaching record highs. The computing power investments driven by the AI wave have substantially diverted memory chip capacity originally allocated to the smartphone sector, becoming the main driver of this price hike.
Jiang Han, a senior researcher at Pangoal Institution, stated that the root cause of this price surge is the explosion of the AI industry. A single AI server requires several times more DRAM than a regular server. The three major memory giants are shifting advanced production processes towards HBM and server products, capturing a large share of production capacity and squeezing out capacity for consumer electronics storage.
It is worth noting that this storage chip price surge may have a significant impact on the broader consumer electronics (3C) sector. Recently, Wang Teng, former General Manager of Xiaomi's China Region Marketing Department, stated on his personal Weibo account that memory prices will continue to rise in the second quarter, making this a very difficult year for the consumer electronics industry. Prior to this, Meizu announced it would suspend in-house hardware development for new domestic phone projects. The announcement explicitly cited intense market competition and the continuous sharp rise in memory prices, which has made the normal commercialization of the next generation of products unfeasible. Several industry insiders mentioned that following OPPO and OnePlus's price increases, manufacturers like Xiaomi and Honor are also expected to raise prices successively.
The storage chip price surge triggered by AI is not limited to the smartphone industry; the closely related personal computer sector is suffering an even more severe impact. The latest data from TrendForce shows that DRAM contract prices surged by 90%-95% quarter-over-quarter in Q1 2026, while NAND Flash prices rose by 55%-60%. Leading manufacturers like Samsung and SK Hynix are redirecting over 30% of their advanced production capacity towards HBM, directly resulting in a 20% reduction in the supply of consumer-grade memory and flash storage. Laptops, being storage-intensive products, are the first to be affected. An IDC report indicates that the entire PC industry will see collective price increases of 15%-20% in 2026. Mainstream brands like Lenovo and Dell have already issued price hike warnings. The price increases are most pronounced for entry-level PCs, with models priced below 4,000 yuan becoming significantly scarcer as manufacturers abandon low-margin entry-level markets to focus resources on the mid-range market spanning 5,000 to 10,000 yuan.
A student named Li Nuo (pseudonym), who was recently planning to upgrade their computer, expressed frustration, stating that a PC is essential for students, but the current price hikes are excessive. An ordinary laptop for basic tasks now costs over 4,500 yuan, nearly 600 yuan more than last year, with memory prices also doubling. The student feels there is no choice but to continue using their old computer for now.
Jiang Han pointed out that oligopolistic market conditions are exacerbating the supply-demand imbalance. The three major giants control the vast majority of global DRAM production capacity. They strengthen their pricing power through production control and locking in long-term orders. The long cycle for expanding new production lines means supply is unlikely to improve in the short term. Furthermore, the recovery of the consumer electronics market creates a dual "component grab." PC and smartphone manufacturers are accelerating shipments to avoid future cost risks, while major AI companies are competing for high-end production capacity. These dual factors are intensifying the supply-demand imbalance for storage chips, further driving up prices.
An industry analyst, Zhang Shule, suggested that the deeper impact of this price surge goes beyond just costing consumers more money. He noted that the replacement cycle for devices like phones and computers has already lengthened significantly. This memory-induced price hike will likely deter many users who were hesitant about upgrading. However, for 3C products like phones and computers, which are already governed by Moore's Law and often have performance that exceeds most users' needs, devices that are three or four years old often remain quite capable. New models frequently offer only marginal improvements in experience, such as slightly better battery life. Although short-term consumption suppression is possible, with factors like government subsidies and other promotions, the long-term substantial impact might be limited.
In his view, while this price turmoil appears to be a butterfly effect from the competition for AI computing power driving up memory prices, it also reflects a underlying issue for Android smartphone manufacturers: insufficient bargaining power within the supply chain and low self-sufficiency in core components like chips and operating systems. Intense price competition means that a sharp price increase for a single component often forces a across-the-board price hike to maintain revenue, unlike Apple, which can leverage its strong bargaining power within its supply chain to potentially lower prices, creating substantive price pressure on competitors.