Planning a phone upgrade? Nothing CEO says prices could keep climbing
Carl Pei believes smartphone prices could keep increasing through 2026 as memory costs surge and AI companies compete for semiconductor capacity.
Published By: Shubham Arora | Published: Jun 13, 2026, 04:16 PM (IST) | Edited: Jun 13, 2026, 04:16 PM (IST)
If you have been planning to upgrade your smartphone later this year, waiting may not necessarily work in your favour. According to Nothing CEO and co-founder Carl Pei, smartphone prices are likely to continue rising through 2026 as manufacturers deal with increasing memory costs and supply constraints.
In a post on X, Pei explained that the smartphone industry is facing a situation that many brands have not experienced in years. For a long time, companies benefited from falling component costs, which made it easier to offer better hardware without significantly increasing prices. According to him, that trend is now changing.
Memory costs are becoming a bigger problem
Pei says memory has now become one of the most expensive components inside a smartphone. In some cases, it can account for more than half of the total hardware cost of a device.
According to the Nothing chief, the increase is being driven largely by demand from the AI industry. Major technology companies are reportedly securing memory and semiconductor production capacity years in advance to support AI infrastructure and data centres. As a result, smartphone manufacturers are left competing for a smaller supply pool.
He claimed that memory modules which cost less than $20 around a year ago could cross $100 in premium smartphones by the end of this year. Pei also stated that memory is now more expensive than smartphone processors and displays.
To explain the situation, he pointed to the company's own device. According to Pei, memory costs for the Nothing Phone (4a) doubled between the time the company started developing the phone and its launch. He added that those costs have doubled again since then.
What this could mean for smartphone buyers
According to Pei, brands may soon have only a few options. Companies could increase smartphone prices, reduce hardware specifications, or absorb some of the additional costs themselves.
He suggested that price increases of 30% or more may not be unusual in certain cases if component costs continue to rise. He also believes the entry-level and mid-range smartphone segments could come under pressure as brands try to balance pricing and profitability.
Pei noted that some smartphones launched since February have already arrived with prices up to $100 higher than their predecessors. In India, he claimed that several smartphones priced above Rs 30,000 have seen increases of Rs 7,000 or more compared to earlier generations.
Sale season may look different this year
Many buyers usually wait for festive sales and year-end discounts before upgrading their phones. However, Pei believes those discounts may not be as aggressive as before.
According to him, manufacturers cannot simply stockpile memory components to avoid shortages because supply is allocated by manufacturers rather than purchased in unlimited quantities. That limits how much brands can control costs.
Pei also said Nothing expects pricing pressure across its own smartphone portfolio, particularly as future devices move to newer storage standards such as UFS 3.1. He believes rising component costs could also push brands to focus more on software, design, and overall user experience instead of competing only on hardware specifications.
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