As analysts and buyers heaped reward on the semiconductor large put up Q3 2025 earnings, AMD CEO Lisa Su mentioned:
“The demand for compute has by no means been better,” in keeping with Su, with AI demand “insatiable” for the time being.
It is no marvel AMD is not slowing down. As an alternative, in keeping with rumors from Tom’s {Hardware}, a worth hike is on the playing cards in a yr AMD surreptitiously paid extra for components to maintain costs low.
The corporate’s first line of protection was inside; nevertheless, DRAM and VRAM costs have been too excessive for too lengthy, which has harm income. Quickly, increased prices will imply board costs go up, and players and PC builders pays additional on the register.
Nvidia can also be going through the identical provide issues, however its scenario is totally different. The information middle large is pushing aside launching new merchandise for shoppers as an alternative of decreasing costs in a reminiscence market that’s changing into tighter. Prospects should not anticipate Nvidia to decrease costs to get extra market share whereas reminiscence makers concentrate on AI-class components.
The information middle is crucial half. Hyperscalers are racing to coach larger fashions, which is making it onerous to get HBM and DDR5 RDIMMs. That is pushing wafer begins and back-end capability towards the merchandise that take advantage of cash. As fabs change their manufacturing to match that demand, client reminiscence is tight, and desktop GPUs really feel the hit straight away.
The improve resolution now begins with reminiscence costs, not simply cores or clocks.Picture by I-HWA CHENG on Getty Pictures
That tilt has triggered DRAM prices to undergo the roof, and it has even affected GDDR6, the reminiscence that drives at this time’s gaming PCs. Analysts now name the enterprise a “reminiscence bull market” since producers are placing AI accelerators forward of different components. For players, the selection on the prime means fewer gross sales, much less inventory, and costs that go up with every new cargo.
By the top of 2025, DRAM contract costs had gone up by three digits per yr, and spot markets had been going up as provide turned tighter. Costs for GDDR6 rose by round 33% to 43% for all speeds and densities.
The subsequent-gen GDDR7 pipeline stayed tight sufficient to maintain stress on current-gen components. Retail cabinets are behind contracts, however they do comply with them. This suggests that the costs shoppers pay in 2026 will likely be primarily based on the present prices of the invoice of supplies offered by companions.
Anybody who needs to save cash mustn’t do it now. The Radeon RX 9070 XT got here out on Black Friday at $599, which made high-end efficiency out there to extra builders for a brief interval. The cardboard’s avenue worth will most likely go as much as the low to mid-$600s when wholesalers reload their cabinets at better prices. That is earlier than outlets add their very own pricing or native taxes.
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Board companions have made it plain that “now’s the time to purchase” if an improve was on the listing earlier than. DDR5 system reminiscence is likewise falling behind. It hasn’t fully accounted for adjustments in contracts and spots but, however it tends to go up in levels when older, cheaper inventory is bought. Count on fewer doorbusters, extra secure worth flooring, and a smaller distinction between MSRP and what you actually pay in 2026.
The information point out why AMD cannot sustain with rising reminiscence costs. Within the third quarter of 2025, AMD bought $9.2 billion price of products. The GAAP gross margin was 52%, whereas the non-GAAP gross margin was 54%. These numbers are wonderful, however they do not depart a lot house for steady subsidies in client graphics.
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The Gaming phase, the place GPU costs make an impression , made $1.3 billion, up 181% from the yr earlier than. This was principally due to gross sales of Radeon and semi-custom items. However that enhance nonetheless must cope with enter costs rising far faster than regular seasonal stress.
Passing on a part of the associated fee retains unit economics secure with out the necessity to regularly lower costs to promote stock. It additionally helps AMD’s companion ecosystem keep sturdy, as a result of board makers have to deal with the identical worth hikes for reminiscence and different components. Altering the costs is a technique to safeguard product cadence and channel well being in a market the place reminiscence, not silicon, units the tempo.
Nvidia is with a much bigger cushion, which is necessary for technique. Within the first quarter of FY26, the semiconductor large produced $44.1 billion, with $39.1 billion coming from information facilities. This made them fairly more likely to put AI accelerators forward of mid-cycle client refreshes. If reminiscence retains working out, one of the best factor to do is to maintain specializing in high-margin AI clients and steer clear of aggressive gaming promotions that may reduce revenues.
That place has an impact on the entire market. AMD does not need to lower its personal pricing with huge gross sales because it does not have a contest that units costs. Shops do not need to have large offers to amass extra shoppers both. The top result’s a client GPU stack that reveals the true prices of supplies as an alternative of the cycles from the previous two years, when costs had been fairly low cost.
By the top of 2025, contract costs for DRAM may have gone up by 3 times what they had been the yr earlier than.
GDDR6: rising by 33% to 43% in 2025
Radeon RX 9070 XT: $599 on Black Friday; with the value bump, it should most likely be within the mid-$600s.
The rise of AI is not solely shattering data in information facilities; it is also remodeling how shoppers buy and use computer systems, starting with the reminiscence bus. GPUs would be the first to alter costs, as HBM, DDR5, and GDDR6 are all in excessive demand. RAM will not be far after.
The Christmas window for 2025 would look higher subsequent to the shelf tags for 2026 should you’re planning a undertaking. Buyers ought to take note of how rapidly reminiscence prices decline in gaming relative to how lengthy AI controls many of the provide.
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