Nothing CEO Warns Memory Costs Exceed Half of Smartphone Bill

In a post on X, Carl Pei, co-founder and CEO of Nothing, wrote, "Memory is now the most expensive component in a smartphone. It's more expensive than the processor, more expensive than the display, and can account for more than 50% of the total hardware bill," as reported by The Verge and TechSpot. Pei added that for the Nothing Phone (4a), memory costs "doubled between when we decided to build the device and when it launched. They've doubled again since," a point also covered by Yahoo and multiple outlets. Pei cited recent launches showing price increases of about $100 since February and noted that in India some phones above Rs 30,000 now carry price tags roughly Rs 7,000 higher, as reported by The Verge and TechSpot.

Demand from AI-focused data center builds has materially increased demand for DRAM and other memory products, shifting factory allocations toward server customers and raising spot and contract prices for consumer-grade memory. Public coverage of the current cycle indicates both DRAM and solid-state memory have been affected, creating tighter allocations for OEMs that historically relied on steadily declining component costs.

If memory now consumes a majority share of the bill of materials for mainstream phones, OEMs have less headroom to absorb component-price inflation or to fund promotional discounts. Multiple outlets report Pei's claim that phones released since February have launched at about $100 higher than prior generations; that figure comes directly from Pei's public post as reported by The Verge. The shift also helps explain contemporaneous price moves in other consumer electronics covered in public reporting, including recent console and laptop price increases, which media outlets have linked to elevated component costs.

Watch DRAM spot prices and manufacturer allocation notices, contract ASPs reported by memory vendors, and OEM bill-of-material disclosures where available. Regional impacts matter: outlets reported larger absolute price jumps in price-sensitive markets such as India, which could alter product mix and go-to-market timing. Also monitor announcements from major memory manufacturers and large cloud/data center customers for evidence of continued allocation toward server demand.