A deepening memory chip shortage is hitting major technology hardware manufacturers, with companies like Apple, HP, and Dell forced to make difficult decisions between shrinking their profit margins or raising prices on consumers.
Industry analysts describe the situation as unprecedented. Prices for memory and storage components have soared, pressuring hardware makers already grappling with inflationary costs and competitive markets. At the same time, chip suppliers are reporting record profits, shifting market power firmly into the hands of component producers.
Rob Thummel, senior portfolio manager at Tortoise Capital, described the situation as a no-win scenario for device manufacturers. They must either accept lower profit margins, risking negative reactions from investors, or pass rising costs onto consumers, which could stifle demand for laptops, smartphones, and other personal electronics.
Apple, once a reliable market leader, saw its stock rise only 8.6 percent in 2025 — the company’s weakest year since 2022. So far in 2026, shares have dropped another 4.2 percent, placing Apple among the 20 worst-performing companies in the Nasdaq 100 Index. HP has fared worse, with shares down nearly 7 percent in early 2026 after losing almost a third of their value in 2025. Dell Technologies has seen its stock drop 28 percent since peaking in October.
Meanwhile, memory chip makers are thriving. Sandisk leads the S&P 500 in early 2026, with its stock up more than 60 percent. Western Digital and Micron Technology are also ranked among the index’s top 20 performers. Micron recently shuttered its Crucial consumer brand to focus on higher-margin sales to AI data centers, further tightening supply of DRAM used in everyday products.
Micron’s leadership confirmed the shift during a recent earnings call, citing explosive demand from AI infrastructure projects. CEO Sanjay Mehrotra warned that memory supply will remain “substantially short of the demand for the foreseeable future,” signaling continued strain on hardware manufacturers and rising costs for consumers across the board.
