RAM and GPU prices are soaring high, and reportedly, they will continue to go up further ahead. Some kits have doubled in cost since last spring. Behind all this surge is the Artificial Intelligence boom, a ravenous driver. With the tech giants funneling billions and billions into AI data centers, they are purchasing memory and processors at unprecedented levels, which in turn has squeezed up the global supply.
But what would happen when the AI hype deflates? Well, truthfully, and reportedly, it can reshape the entire electronics market, and the speculation about it already seems to be brewing.
Understanding the AI bubble burst’s aftermath
The industry observers are sketching up 2 different pictures after the AI bubble burst. As per their suggested first scenario, there would be immediate and sharp relief. If the venture capital dries up and the unprofitable AI startups will start to falter, with a rapidly contrasting data centers’ demand.
It will theoretically free up the production capacity at DRAM’s 3 major manufacturers—Samsung, Micron and SK Hynix. It would allow supply to flow back towards the consumer channel. In its view, the prices for both GPUs and RAM will see some significant correction. It means it will fall from its current historic highs.
The second scenario is, though, way more complex. It warns that the relief might not be too straightforward. In simple words, the memory manufacturers aren’t that naïve. They remember the past boom and bust cycles. So, after the demand spike subsides, rushing to increase production quite often brings painful glut. It forces companies to sell chips at a loss.
Note: Manufacturers, including SK Hynix, reportedly already sold out their production capacity all through 2026, with binding agreements.
But this time, they will be intentionally cautious. They can refuse to dramatically ramp up the output. Or they could simply build some costly new fabrication plants, for what they might have a temporary bubble. Consequently, despite the AI demand cooling off, the supply pipeline might be tighter by design. It would prevent any classic price crash.
Ripple impact will be much beyond just the PC build
This entire problem that is now and will be the future, isn’t just for the PC builders and gamers. The memory chip shortage actually creates a domino effect. It reaches far more into the world’s everyday tech. Every single modern device, covering next-generation gaming consoles, smartphones, smartwatches and even automobiles, relies on similar foundational DRAM chips. As AI corporations will outbid all for these components, it would strain availability for all other industries.
The console manufacturers reportedly are already concerned. Reportedly, there are some internal discussions already happening about potential delays within upcoming hardware releases because of memory availability and cost. For an average consumer, it means the complete electronics ecosystem can see some sustained higher price tags or just product delays.
The demand surge of AI is not just creating an isolated and separate market. It is applying inflationary pressure all across the board. It makes the chips in phones, cars, as well as the entertainment system harder to produce and expensive too.
Why are manufacturers hesitant to change things
A logical question that’s been arising around the world is—why don’t the major chipmakers just produce more to meet overwhelming demand? The answer has revealed a long-term, calculated business strategy which gives priority to stability over all short-term spikes.
At first, building new semiconductor fabrication plants is a multi-billion-dollar, multi-year endeavor. By the time the new factory is out there available for use, the AI bubble might have already burst. It will leave manufacturers with a catastrophic overcapacity.
Secondly, the companies are now more actively managing the market to avoid future collapse. They have stated publicly that they would not aggressively expand production, having taken lessons from the past cycles, wherein the demand downturn caused devastating cycles. They would instead keep the supply constrained and the prices higher than risking the return to selling at a cost.
Further, with some firms like SK Hynix reportedly selling out of production through 2026, any new supplies would be at premium prices. It will lock in the high costs for the foreseeable future, irrespective of the fluctuating demand.
