2026 will bring sharpest PC declines in over a decade — PC shipments to fall 10.4%

Gartner on February 26 projected global PC shipments will fall 10.4% and smartphone shipments 8.4% in 2026 compared to 2025 levels, driven by what the firm estimates will be a 130% surge in combined DRAM and SSD prices by the end of the year.

The forecast puts 2026 on track for the steepest device shipment contraction in over a decade, according to Ranjit Atwal, senior director analyst at Gartner. The report landed one day after HP disclosed on its Q1 2026 earnings call that memory now accounts for 35% of its PC bill of materials, up from 15-18% last quarter, confirming in real financial terms what the rest of the industry has been warning about since late 2025.

This will lead to price increases of 17% among PCs year-over-year, leading to PC lifetimes extending by 15% for business users and 20% for consumers by the end of 2026, with the entry-level market facing the worst of it. Memory is on track to account for 23% of a PC's total bill of materials in 2026, up from 16% in 2025, a shift that Gartner says eliminates vendors' ability to absorb costs on low-margin products.

"This sharp increase removes vendors' ability to absorb costs, making low-margin entry-level laptops nonviable," Atwal said. "Ultimately, we expect the sub-$500 entry-level PC segment will disappear by 2028."

No hyperbole here

RAM price tracking paints a picture consistent with Gartner's projections, with a 32GB DDR5-6000 kit that cost between $100 and $200 in October 2025 now starting at roughly $350. Some kits have climbed even higher: a Corsair Vengeance 32GB DDR5-6000 kit stabilized at $339 between November and January before jumping to $439 in early January, where it stayed through the end of the month. A Patriot Viper Elite 5 16GB DDR5-6000 kit went from $43.99 in October 2025 to $169.99 by early December.

By late January, some modules had stabilized at their inflated values, with DDR4-3200, DDR4-3600, DDR5-4800, and DDR5-5200 kits leveling off. Higher-end DDR5-5600 and DDR5-6000 kits were still climbing, though at a slower pace. More recent data from late February shows modest corrections in European DDR5 pricing, with some 32GB DDR5-6000/6400 kits in Germany falling from early-February peaks. But those declines have been modest, and no major source forecasts a return to pre-crisis pricing any time soon. For perspective, DDR5-6000 kits in the EU that averaged around €95-€100 through early autumn 2025 were still hovering around €425-€470 by in recent weeks.

NAND flash has been hit just as hard, with Phison's CEO warning that eMMC NAND common in phones and low-end devices had climbed from $1.50 to $20 per 8GB module last year, a 13-times increase, and said at least one foundry now demands three years' cash upfront for NAND supply. Kingston confirmed it saw a 246% increase in NAND wafer prices and publicly told consumers not to wait for lower prices.

OEM price rises across the board

HP CEO Karen Parkhill said during the company’s Q1 2026 earnings call on February 25 that memory costs increased roughly 100% sequentially from Q1 to Q2, with expectations for further increases throughout the fiscal year. Despite those headwinds, HP's Personal Systems division posted an 11% year-over-year revenue increase to $10.3 billion on the back of Windows 11 upgrade cycles, but Parkhill said the company now expects a sharp double-digit decline in system shipments over the rest of the year as price increases take hold.

HP is already adapting by pushing lower-memory configurations and onboarding new suppliers, including reportedly exploring cheaper Chinese memory sources. Ketan Patel, HP's president of personal systems, said the company wants to "leverage part of our broad portfolio with silicon diversity" to offer different configurations and introduce low-memory options.

HP isn’t alone; Lenovo warned partners in late February to lock in orders by February 28 to avoid post-March price hikes on DRAM and NAND, while Dell told partners in December to expect price increases of up to 30%. Acer and Asus have also both confirmed they will pass higher memory costs through to consumers. TrendForce projects Q1 2026 will bring a record 90%-95% quarter-over-quarter jump in PC DRAM contract prices.

The knock-on effects of all this will extend (and already are extending) well beyond traditional PCs. Valve confirmed the Steam Deck is sold out globally due to memory and storage shortages, while Framework has raised DDR5 RAM upgrade prices by 50% for its DIY laptop edition in December and warned prices would likely rise again. Motherboard sales in some markets have dropped as much as 50% as builders balk at the cost of memory.

A more bearish outlook

IDC published its own updated forecast on February 26, and its numbers are now worse than Gartner's across the board. IDC projects the worldwide PC market will decline 11.3% in 2026, exceeding Gartner's 10.4%. Its smartphone outlook is even worse, with IDC expecting a 12.9% decline, far steeper than Gartner's 8.4%. Both figures represent a dramatic downward revision from IDC's December 2025 scenarios, which ranged from -4.9% to -8.9% for PCs and -2.9% to -5.2% for smartphones.

Part of this worsening picture is a pull-forward effect caused by PC and smartphone vendors shipping aggressively in Q4 2025 and into Q1 2026, rushing to get products out before memory price increases took full effect. IDC expects volumes to fall off dramatically starting in Q2. PC revenues will still grow 1.6% in 2026 thanks to higher ASPs, but neither market is expected to rebound until 2028.

IDC, like Gartner, sees the most damage at the budget-end of the market. More than 360 million smartphones shipped below $150 last year, and IDC said rising memory costs are rendering that price band unsustainable. Ultra-low-end smartphones below $50 could cease to exist, potentially reversing smartphone penetration gains in emerging markets. IDC does not expect a return to 2025 pricing within its forecast horizon.

Could things improve?

Potentially. Some prices are now stabilizing, though at levels that remain two to three times higher than mid-2025, and European DDR5 pricing has shown modest corrections from early-February peaks. If new memory fab capacity comes online faster than expected, or if AI infrastructure spending plateaus — unlikely — the worst-case scenarios may not fully materialize.

But the structural driver of this crisis, the deliberate reallocation of memory manufacturing capacity from consumer DRAM and NAND toward AI-focused HBM and high-density server modules, doesn’t look to be going anywhere, anytime soon. Samsung, SK hynix, and Micron have all prioritized HBM production, with Micron even controversially shuttering its Crucial consumer business, while TrendForce bleakly estimates that data centers will consume 70% of all memory chips manufactured in 2026.

Gartner advised vendors to accept unit volume declines rather than erode margins chasing price-sensitive buyers, and flagged the first half of 2026 as a critical window for optimizing pricing before component inflation compresses profitability further in Q2 and beyond. For consumers and builders, the calculus is straightforward: the era of cheap memory that defined the last several years of PC building is over, and nothing in the current data suggests it will return soon.

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