The rising component costs and device supply pressures that hit the console and gaming PC markets this year are increasingly likely to persist for the foreseeable future, as SK Hynix forecasts that memory semiconductor demand will outstrip supply structurally through 2030. With long-term supply allocated to artificial intelligence (AI) data centers already exceeding half of total production capacity for 2027–2028, relief in supply and demand for the consumer hardware market is unlikely.
| 📒 | - Concerns grow over prolonged memory cost and supply pressures hitting consoles and gaming PCs - SK Hynix projects structural memory supply shortage to last until 2030 - Over 50% of total production capacity for 2027–2028 tied up in long-term contracts for AI and other sectors |
The imbalance in memory supply and demand has already led directly to price increases and initial supply disruptions across the gaming hardware market this year. As semiconductor production lines concentrated on High Bandwidth Memory (HBM) for AI servers and enterprise SSDs, prices for consumer DRAM and NAND flash surged in tandem.
In fact, Valve raised prices for its handheld console, the 'Steam Deck OLED', by more than 40% depending on the model in May, citing rising component costs. Following that, Valve priced the base model (512GB) of its living room gaming PC, the 'Steam Machine', launched in June, at $1,049 (~1.4 million won), stating, "Drastic fluctuations in RAM and storage prices over the past year or so made it impossible to maintain our original target price range, and difficulty securing components also impacted initial production volume at launch."
Console manufacturers and the PC graphics card market were also unable to escape memory-driven cost increases. In April, Sony raised the US price of the standard 'PlayStation 5 (PS5)' model by $100 (~130,000 won) to $649.99 (~870,000 won), citing a surge in memory chip prices combined with logistics instability. Nintendo similarly announced price hikes for the 'Nintendo Switch 2' in May as component cost burdens including memory grew, adjusting its US retail price upward by $50 (~67,000 won) to $499.99 (~670,000 won) starting in September. In the graphics card market as well, rising procurement costs for GDDR memory have been cited as a key factor driving up retail prices.
Against this backdrop, major memory supplier SK Hynix projected in its Q3 earnings release on the 28th that the supply-demand imbalance will be prolonged. Analysis indicates that enterprise and personal AI in the short term, and 'Physical AI' such as autonomous driving and robotics in the mid-to-long term, will steadily support memory demand growth. Conversely, the company explained that as the technical complexity of advanced processes increases and building new production facilities takes substantial time, the pace of supply growth will struggle to catch up with demand.
The trend of prioritizing available supply for AI infrastructure is also clear. SK Hynix has currently signed Long-Term Agreements (LTAs) with 14 major customers, including global cloud service providers. The contracted volume already secured exceeds 50% of its total production capacity for 2027–2028. The company is also discussing options with several customers to extend contract terms beyond the typical five-year period.
To meet market demand, SK Hynix plans to rapidly expand the share of its 6th-generation 10nm-class (1c) process in DRAM and maximize the production capacity of its M15X fab in Cheongju by the end of the year to expand HBM4 production. In NAND, it will increase the share of its 321-layer process to over half of domestic production capacity in the fourth quarter. It also expects domestic and overseas infrastructure investments to rise significantly once Phase 1 fab of the Yongin Semiconductor Cluster enters full operation next year. However, as newly added production capacity will also be prioritized for high-value products such as DDR5 for AI servers, HBM4, and enterprise high-performance SSDs, the memory cost burden on gaming PC components and console hardware markets is unlikely to ease anytime soon.
