"Cruel reality": TVs and consumer electronics to rise in price in 2026 due to AI boom

The shortage of memory chips caused by the development of artificial intelligence is forcing electronics manufacturers to lower their sales forecasts. Many industry executives expect the shortage to persist throughout this year and possibly continue into 2027, writes Nikkei Asia.

The most affected segments will be entry-level and mid-level consumer electronics, including TVs, set-top boxes, home routers, budget tablets, smartphones, and personal computers, as well as cars, as they require longer inspection cycles.

Anthony Peter Bonadero, president of Compal Electronics, the world's largest contract notebook manufacturer, said that at this point, the industry expects the trend seen in late 2025 to continue. This includes volatile prices and limited supplies, as the three largest memory manufacturers favor HBM over less advanced memory products.

"This trend is likely to continue until at least 2027, which will affect the industry. People will tend to use their existing products longer," he said.

At the end of last year, Nikkei Asia first reported that PC and electronics manufacturers had sent their employees to the headquarters of memory chip giants SK Hynix and Samsung Electronics to negotiate additional supplies.

However, these efforts have largely been in vain. Leading chipmakers prefer the production facilities of AI giants and wealthy cloud service providers willing to pay high prices for high-bandwidth memory (HBM) and other advanced memory products, rather than serving more price-sensitive manufacturers.

"When the demand from AI chip developers like Nvidia and others is already several times higher than the demand from everyone else, the leading memory manufacturers simply cannot focus on smaller brand customers," a manager at a memory chip company told Nikkei Asia.

This is especially true for customers who have sharply reduced prices and cut orders over the past few years when end markets were weak, he added.

"It's a brutal reality, but relationships with memory suppliers matter in critical situations," the source said.

Khein-Seng Pua, CEO of Phison Electronics, a developer of NAND flash memory controller chips, believes that the situation may become even more complicated for consumer electronics manufacturers.

"Demand from servers and AI is extremely strong, and we expect NAND flash prices to continue to rise sharply through 2026," Pua said.

Many manufacturers of consumer electronics may not be able to withstand such price increases, said the head of Phison Electronics.

"TVs will be severely affected, and products such as set-top boxes will also be hit hard. The total volume of supplies will definitely decrease. Many of them simply cannot afford such prices," he explained.

According to Nikkei Asia's sources, as a fallback, some PC makers are developing entry-level models with additional memory slots so that customers can expand capacity as needed. Others have warned their partners and customers that prices will have to be raised due to the sharp rise in the cost of memory chips.

Johnny Shih, chairman of Asustek Computer, the world's fifth-largest PC maker, said that the PC industry as a whole will definitely raise prices for new products in 2026 to cope with the sharp rise in the cost of memory chips.

According to him, Asustek is actively restructuring its product line to optimize memory supply and introduce new models that better meet customer demand.

The head of a Japanese component supplier whose clients include a wide range of PC and smartphone manufacturers has issued a warning to consumers.

"If you want to buy any consumer goods, personal computers, or smartphones, do it now because prices are sure to rise," he said.

According to him, the share of memory chips in the cost of completing an average computer has increased from about 15% to almost 40%.

Prices are already rising, the publication states. LG Electronics' new flagship laptop, the LG Gram Pro AI 2026, now costs $2,300, which is more than 40% higher than a year ago.