CES 2026 is a show that usually paints us a picture of what's to come. But this year was different. Dominated by AI and a handful of product launches in Panther Lake and AMD's new AI 400 chips, there wasn't exactly a whole lot to see. When the Consumer Electronics Show starts looking like the Corporate Electronics Show, alarm bells should start going off in your head.
Sure, Nvidia's upcoming Rubin platform looks incredibly impressive, but there were no new consumer GPUs to speak of. There is little to show what actual consumers and enthusiasts might look forward to for the rest of the year, and that's not only illustrated by what our staff on the show floor had to say, but also by the companies and supporting industries around it.
Now, we don't have to get into all the reasons why there's an ongoing NAND and DRAM shortage; we've explained it multiple times before. But, how far-reaching are the impacts of the current demand for AI chips, and why is it going this far? The picture that current market conditions paint is grim, and it's already too late to prepare for the great consumer chip winter upon us.
Everyone is affected
As tech enthusiasts, everyone wants something new to look forward to. A new chip on the latest leading-edge nodes, packed to the gills with power to run the most demanding games without breaking a sweat. Breakthroughs in efficiency to bring down power envelopes and chips to break records with. But, none of that seems to be happening in 2026 (Unless you were one of the lucky few who purchased the $5000 MSI Lightning Z RTX 5090).
Now, according to a Bloomberg report, the current tightened chip supply might push Sony's next PlayStation consoles to 2028 or 2029, with Nintendo contemplating raising the price of its Switch 2 consoles. Valve's Steam Frame VR Headset and Steam Console still don't have any pricing details announced, as the company struggles to keep its four-year-old Steam Deck in stock. We've seen some impact on DIY hardware, too, with AMD explaining that they've seen an uptick in AM4-based builds, over the newer DDR5-only AM5, likely due to how expensive memory has become for builders.
(Image credit: Tom's Hardware)
But it's not just gaming companies that are feeling the pinch. DRAM and NAND chips soaring to eye-watering levels are having a considerable impact on other areas. Think about every device that might use a RAM IC or house a small bit of flash. Entry-level electronics like smartphones, and much more, all rely on memory and flash in some capacity, and are also affected by pricing pressure. Even electronics such as routers are vulnerable to these pricing shifts. So, once current stocks run out, manufacturers and companies will have to buy at market rates, which are being pushed significantly higher due to AI data center demands.
The auto industry has also been subject to the onslaught of AI demand. EVs and other vehicles use specially qualified ICs (AEC-Q100) for use in extreme temperatures, and once stocks are gone, companies may find themselves scrambling for supply. “It’s not that we can no longer make semiconductors, or we can’t make enough semiconductors. We’re in a situation where the industry is constrained by qualification and requalification,” said Akshay Baliga, director at AlixPartners, in a recent interview with Tom's Hardware Premium. Qualifying these specialty chips, which are comparatively low-margin compared to AI, means that memory makers have their eyes on a much bigger prize: the lucrative AI market.
The industry stands on a cliff's edge
... continue reading