Global chip market in Q1 2026: AI driven full chain price increase, deep restructuring of supply and demand pattern

In the first quarter of 2026, the global semiconductor market experienced its strongest business cycle in history. Driven by the explosive demand for AI computing power, structural mismatch of production capacity, and cost resonance, chip prices have skyrocketed across the board, and market demand has shown a differentiated pattern of "high-end crowding out, mid-range tightness, and low-end pressure". The entire industry chain has entered a super upward channel with both volume and price rising. 
1、 Price surge: Storage leads the rise, resonating across the entire chain 
Storage chips have become the core engine of this round of price increases, with the increase far exceeding expectations. According to TrendForce data, in Q1 2026, the contract price of conventional DRAM surged by 90% -95% month on month, while the contract price of NAND flash memory increased by 55% -60%; The spot market is even crazier, with DDR4 8Gb pellets soaring 369% from their 2025 low, and some models experiencing spot price increases exceeding 300%. Due to the urgent demand for AI servers, the supply and demand gap of HBM high bandwidth memory has reached 50% -60%, and the price continues to hit historical highs. 
Rapid transmission of price increases to the entire industry chain: 
CPU/GPU: Intel and AMD raised prices across the entire range from March to April, with an average increase of 10% -15%, and the lead time was extended from 1-2 weeks to 8-12 weeks. 
Simulation/Power/MCU: Texas Instruments launches its third round of price adjustments this year in April, with some products experiencing a maximum increase of 85%; Infineon, NXP, and Anson are following suit, with an increase of 5% -25%. 
Wafer foundry: TSMC's advanced processes below 5/4nm will be fully loaded until the end of the year, with price increases; Mature processes such as UMC, World Advanced, and SMIC (8-inch) will increase their prices by 5% -20% from April to June. 
Packaging and Testing/Materials: Due to the impact of gold prices and tight production capacity, packaging and testing prices have increased by 5% -30%, while the average price of materials such as silicon wafers and photoresist has increased by over 30%. 
2、 Demand differentiation: AI computing power dominates, structural imbalance 
The demand for AI computing power is the core driving force behind this round of market trends. A single AI server uses 8-10 times more DRAM and 3-6 times more NAND than traditional servers. Gartner predicts that global AI server shipments will increase by 180% year-on-year in 2026, surpassing 1.5 million units, directly igniting demand for HBM, DDR5, and high-end logic chips. 
There are three major characteristics of supply and demand: 
Capacity siphon: Samsung, SK Hynix, and Micron will shift their advanced production capacity from 70% to 80% to high margin products such as HBM, significantly squeezing the supply of consumer grade storage. 
Shortage of mature processes: During the industry downturn period of 2023-2024, there will be a large-scale reduction in production of 8-inch mature processes. Currently, there is a concentrated outbreak of demand for AI power supplies, automotive electronics, and industrial control, forming a structural supply gap. 
Consumer electronics under pressure: Weak demand from consumer devices such as smartphones and PCs, coupled with rising costs, led to a 7% -22% pullback in retail prices for some consumer grade DDR5 devices in March, but prices for granular devices remained firm. 
3、 Market outlook: Super cycle continues, domestic substitution accelerates 
SIA data shows that global semiconductor sales reached 82.54 billion US dollars in January 2026, a year-on-year increase of 46.1%, and are expected to break through the 1 trillion US dollar mark for the first time throughout the year. TrendForce expects that this round of price increase cycle will last at least until the first half of 2027, and advanced process and AI related chips will maintain high prosperity. 
Accelerating the restructuring of the industry landscape: 
Head concentration: The concentration of storage, advanced OEM, high-end simulation and other fields has further increased, with major manufacturers dominating the pricing power. 
Domestic substitution window: Price increases and tight supply have opened up substitution space for domestic chips (storage, power, analog). Domestic manufacturers have increased prices intensively, and their market share has steadily increased. 
Downstream pressure: PC, mobile phones, home appliances and other terminals are facing cost pressure, and price increases may gradually be transmitted to the consumer market, entering a new stage of "strong people stay strong, survival of the fittest" in the industry. 
4、 Risk Warning 
If the growth rate of AI demand slows down or large factories expand production beyond expectations, it may trigger a price correction. 
Geopolitics, fluctuations in raw material prices, and sustained sluggishness in consumer electronics will affect the sustainability of the cycle.