Who could have expected that a single dinner Jensen Huang had in South Korea would end up draining the wallets of hundreds of millions of smartphone users by 2026?
In late October, the Nvidia founder and CEO met Samsung Electronics executive chairman Lee Jae-yong and Hyundai Motor Group chairman Chung Eui-sun over fried chicken and beer at a small restaurant in Seoul. The place is called Kkanbu Chicken, with “kkanbu” a slang term meaning “close friend” in Korean. During the meal, Huang gave Lee and Chung a boxed Nvidia DGX gift set and added a handwritten note. South Korean outlets later reported that his aim may have been to strengthen ties with Samsung and secure additional capacity for high bandwidth memory, or HBM.
As the three talked and laughed, the supply chain serving Chinese smartphone makers felt pressure building. In early November, the industry learned that Samsung’s LPDDR5, which had been rising in price throughout 2025, would no longer be quoted due to limited available capacity.
HBM and LPDDR, or low-power double data rate memory, serve different roles. LPDDR functions like a set of low-rise townhouses, and it is used in smartphones, laptops, and tablets. HBM resembles a vertical tower built by stacking layers of memory, making it the most complex and costly type, commonly used in compute centers that train large artificial intelligence models.
Through 2025, Nvidia has absorbed significant amounts of LPDDR capacity to support AI applications and model training. With total memory production capped, smartphone makers have faced shortages, production cuts, and looming price increases. For Chinese smartphone brands, 2026 is on track to bring higher prices and more limited configurations.
Nvidia sweeps up memory chips
“Memory prices are soaring, faster than gold,” a veteran in the industry told 36Kr. Samsung’s LPDDR4X illustrates the trend. It climbed sharply three times this year, in March, April, and October, rising from USD 6 to USD 25, a more than threefold increase. More advanced LPDDR5 options saw similar movements, and Samsung stopped issuing price quotes in November.
The memory market typically follows a predictable cycle. Rising prices encourage suppliers to expand capacity, which leads to oversupply, price declines, and eventual production cuts. That sets the stage for the next upcycle. According to the industry veteran, 2025 was already expected to mark the start of such an upcycle, with higher prices and tighter supply. Nvidia’s aggressive efforts to secure capacity have intensified the strain, disrupting the usual rhythm.
Nvidia is now the largest buyer in the memory industry. To show commitment, Huang has appealed to suppliers through personal outreach and by addressing their biggest operational challenge: payment cycles. Nvidia is placing large prepayments with companies including Micron and SK Hynix to secure future HBM output. Smartphone makers typically settle payments quarterly, leaving them at a disadvantage.
36Kr conducted a rough calculation of Nvidia’s HBM consumption this year. The company is expected to ship 3–4 million GPUs in 2025. Each GPU pairs with roughly 80–140 gigabytes of HBM. For reference, the H100 contains 80 GB of HBM3 and the H200 contains 141 GB of HBM3E. Using conservative assumptions, Nvidia will consume at least 240 million GB of memory in 2025. At 12 GB per smartphone, that amount equals the memory needed for 20 million phones, or roughly one tenth of China’s annual smartphone shipments.
Suppliers are not necessarily troubled by Nvidia’s dominance. HBM sells for several times more than LPDDR, and each new generation carries higher value. HBM3E now costs about 50% more than HBM3. Revenue from AI and data centers accounts for 15–20% of Samsung and SK Hynix’s capacity, approaching the 30–35% share attributed to smartphones.
To capture AI demand, memory companies are doubling their annual capacity expansions for Nvidia and aggressively shifting production. Samsung and SK Hynix are prioritizing advanced nodes suited for HBM and reducing output of lower margin legacy products such as LPDDR4. Even LPDDR5, used in high-end smartphones, is being squeezed.
Because of this internal reallocation, several industry experts told 36Kr that the gap between supply and demand may take longer than usual to close. Shortages could extend into 2027 or beyond. “This year’s situation is unprecedented in decades,” another veteran said. “We may be entering a supercycle in the memory industry.”
Smartphone makers brace for impact
Chinese smartphone makers are now navigating that environment. A supply chain veteran told 36Kr that the market has tilted into a seller’s market, shifting the balance of power. Previously, smartphone companies placed quarterly orders and suppliers usually met them. Now, those orders may be cut. One large manufacturer recently had 30–40% of its requested volume reduced by its supplier. “It’s no longer about how much you want,” the person said. “It’s about how much Samsung or SK Hynix can spare for you.”
The larger the product line, the greater the memory gap and the stronger the cost pressure. Recent flagship launches show how those pressures are appearing. High memory configurations, such as 24 GB of RAM and one TB of storage, may have become mainstream, but momentum stalled in 2025. Aside from Redmi and RedMagic, few major brands still offer such configurations. Top tier flagship models are mostly capped at 16 GB of RAM.
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Prices have adjusted as well. Models with 16 GB configurations are now significantly more expensive than they were last year. Manufacturers are responding. Jiang Chao of RedMagic wrote recently that the team has been pressing suppliers for inventory as costs rise. A product manager at another company told 36Kr that projects with low margins or uncertain sales have been canceled to conserve limited memory supply.
A few domestic suppliers are benefiting from the disruption. A veteran in the memory industry said that Xiaomi has been searching aggressively for supply, reaching out to domestic manufacturers that previously struggled to enter the first tier. Some of these companies are now receiving inquiries and orders. On another front, 36Kr learned that Huawei, with deeper financial capacity, is locking up the entire output of a leading domestic memory maker.
Consumers, however, will likely bear the cost. Guo Tianxiang, a research manager at IDC China, told 36Kr that rising memory prices will push high-end smartphone prices further up. Midrange phones will experience smaller increases but may face slower upgrade cycles. Low-end devices will face the most pressure, with limited room to cut costs, fewer models, and lower shipment volumes.
Guo expects that, due to cost constraints, many smartphones in 2026 will be downgraded in certain areas, and overall product upgrades will be modest. For consumers navigating this wave of memory inflation, the most practical advice may be simple: consider buying a new phone sooner rather than later.
KrASIA Connection features translated and adapted content that was originally published by 36Kr. This article was written by Qiu Xiaofen for 36Kr.