19:21 10 July 2026
AI driving inflation despite claims to contrary
Generative AI was expected to have a deflationary effect by reducing the cost of services and office work, but so far it is creating inflationary pressure in electronics. Demand from hyperscalers such as Amazon, Microsoft, Google and Oracle for AI data centers has sharply increased prices for DRAM, NAND and HBM memory. This is benefiting chipmakers such as SK Hynix, Samsung and Micron, which are reporting huge profits, while consumer electronics producers are passing higher component costs on to customers.
Apple, Microsoft, Sony and Nintendo have raised prices for computers, phones and consoles. Investors are increasingly favoring companies that “sell the shovels” for the AI boom, while reducing exposure to firms paying for the infrastructure.
