17:46 - 5.06.2026

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June 5, Fineko/abc.az. Increasing investments in artificial intelligence data servers around the world are driving up the cost of memory and chips, as well as supply problems.

ABC.AZ reports that Ilkay Cihaner, Chief Strategy and Business Development Officer (CSO) and a Board Member at General Mobile, said about the smartphone market: "The smartphone segment is experiencing a very serious crisis in the global market. Increased investments in data processing servers for AI have led to an increase in the cost of memory and chips. As a result, the global market recorded a 2.9% decline in the first quarter. All forecasts for 2026 indicate that the sector will shrink by about 13% compared to last year. This marks an important turning point in the direction of the sector's development."

Ilkay Cihaner noted that the share of chips in the cost of smartphone production, which previously made up 15%, is now approaching 50%.

"Memory prices have increased 6-fold compared to last year. Previously, the share of memory in the cost of a smartphone was 15%, but now this figure has grown up to 45-50%. Since the beginning of the year, the growth reflected in retail prices has been approximately 15%. By the end of the year, the overall price increase is expected to be 35-40%. In particular, the cost growth in the low and medium price segments had a stronger impact than in the high and premium segments. When investing in data centers for artificial intelligence, agreements with manufacturers of memory and chips are concluded for the next 5 years, not for the next 6 months or 1 year. This shows that the crisis is not a short-term and temporary fluctuation. We see that this growth trend will continue until 2028," Cihaner said.