The rapid global adoption of AI models has made many tasks easier, from coding to automating routine work, but it has also created a major side effect: rising memory prices. As AI companies aggressively buy up large volumes of RAM and NAND for data centres, consumer electronics makers are finding it harder and more expensive to secure supply for products like smartphones and laptops.
This imbalance is now proving highly beneficial for memory suppliers. Micron, one of the world’s three major memory chipmakers, has announced that it has effectively locked in elevated memory prices through long-term contracts extending at least until 2030.
In its latest earnings call, the company revealed that it has signed 16 strategic customer agreements designed to secure both supply and pricing for several years. Most of these agreements run from 2026 to 2030 and include structured pricing arrangements with defined lower and upper limits, as well as guaranteed volume commitments.
Micron CEO Sanjay Mehrotra said these deals include a minimum price level that ensures strong profitability for the company, while also capping extreme price spikes for customers. He noted that customers are increasingly seeking long-term supply security due to expectations that shortages will persist for years.
He also said there is no clear timeline for when supply will catch up with demand. While industry capacity may gradually improve around 2028, he admitted there is still no visibility on when equilibrium will be restored.
This suggests that the memory shortage—and the resulting high pricing environment—could continue well into the end of the decade. As a result, companies are locking in contracts now rather than risking further volatility.
The shortage is already affecting consumer markets, with rising prices for devices like smartphones and laptops. Apple recently raised prices for iPads and MacBooks, citing higher memory costs, while other tech firms have also adjusted pricing or scaled back product plans.
Micron has also exited its consumer memory business (Crucial) to focus on higher-margin, AI-driven demand such as high-bandwidth memory used in data centres. Despite investing to expand production, the company says new supply will take time due to the complexity and long lead times involved in building advanced fabrication facilities.
The strategic agreements are expected to generate around $22 billion in revenue, with an additional $100 billion tied to longer-term obligations. While customers have not been named, they include cloud providers, server manufacturers, and companies in automotive and consumer electronics sectors.
Micron, along with Samsung and SK Hynix, dominates the global memory chip market, with all three benefiting from the current demand surge. However, the same AI-driven boom that is boosting their revenues is also reshaping the entire electronics supply chain, keeping prices elevated and supply tight across the industry.
