HP warns that memory now makes up around 35% of the cost its PCs, double that of a year ago
PC Gamer
by Jeremy Laird February 25, 2026
AI-Generated Deep Dive Summary
HP has revealed that memory and storage now account for approximately 35% of its PC production costs, double what it was a year ago. This significant increase highlights the ongoing memory crisis affecting the tech industry. During the company's quarterly earnings call, CFO Karen Parkhill shared that while memory costs previously made up around 15-18% of their bill of materials, they now estimate this to be roughly 35%. This escalation is driven by heightened demand for RAM and NAND flash memory chips, particularly from AI-powered PCs, which require more advanced hardware.
HP's interim CEO Bruce Broussard outlined steps the company is taking to address the supply-side challenges. These include securing long-term agreements with suppliers through fiscal year '26, qualifying new suppliers, building strategic inventory, and reducing the time needed to qualify new materials. Despite these efforts, HP anticipates that its financial performance may fall toward the lower end of its guidance range due to the time required to fully implement these measures.
The memory crisis has not yet significantly impacted HP's revenue, as the company reported strong sales growth across both consumer and corporate PC segments. Demand for AI PCs has surged, with AI-enabled devices now accounting for over 35% of HP's shipments, up from 30% in the previous quarter. This uptick is partly attributed to Windows 11 adoption and the growing popularity of AI-driven systems.
For gamers, this situation matters because high-performance gaming PCs often require significant amounts of RAM and storage. The ongoing memory shortage could lead to higher prices or delays in obtaining the latest hardware, impacting both enthusiasts and professionals who rely on cutting-edge computing power. As HP and other PC manufacturers navigate these challenges, gamers may need to adapt to potential constraints in component availability.
Overall, while HP is taking proactive steps
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Originally published on PC Gamer on 2/25/2026