The Full Story
Nothing CEO says phone prices are going to keep going up due to fundamental supply chain constraints that extend far beyond temporary disruptions. During the Mobile World Congress period in early 2026, Pei publicly acknowledged that memory chip shortages were forcing difficult decisions about component allocation and manufacturing costs. The shortage specifically affects RAM (Random Access Memory), the temporary memory that phones use to run multiple applications simultaneously and handle processing tasks.
Nothing, founded by Pei in 2020 after he left OnePlus, had built its reputation on delivering compelling design and reliable performance at mid-range prices—typically between $300 and $600. The company positioned itself against both expensive flagship devices from Samsung and Apple and cheaper mass-market phones from manufacturers like Xiaomi. This positioning placed Nothing in a vulnerable position when memory costs spiked. Unlike Samsung or Apple, which control portions of their own chip manufacturing, Nothing relies entirely on purchasing components from suppliers facing extraordinary demand.
Pei's warning came as the industry grappled with a semiconductor market shaped by competing demands: artificial intelligence applications consuming unprecedented amounts of memory, legacy devices still in production, and new phone launches all requiring the same limited supply of RAM chips. The constraint was real enough that manufacturers couldn't simply absorb costs—they had to pass them to consumers. For Nothing, a company still building market share against established brands, absorbing the cost differential was economically impossible.
Why This Matters
The Nothing CEO says phone prices are going to keep going up because this represents a structural shift, not a temporary blip. When manufacturing costs increase, companies typically absorb some portion hoping for improved margins elsewhere. But when core components—the actual memory chips that make phones function—become genuinely scarce, manufacturers face a binary choice: raise prices or reduce features. Nothing's public acknowledgment meant the company was choosing transparency over false hope.
For consumers, this signals the end of a two-decade trend where smartphone prices remained relatively stable despite dramatic capability improvements. A flagship phone cost roughly $700-$900 in 2010 and still costs similar amounts today, even with far superior cameras, processors, and displays. That equilibrium depended on manufacturing efficiency gains offsetting feature additions. A RAM shortage disrupts this calculation fundamentally. Every additional gigabyte of RAM—whether 8GB, 12GB, or 16GB—now costs substantially more to source. Manufacturers cannot simply maintain the same price point while including equivalent specs.
Background and Context
Understanding why the Nothing CEO says phone prices are going to keep going up requires understanding where RAM comes from and why 2026 created unusual constraints. Three companies—Samsung, SK Hynix, and Micron—manufacture roughly 90% of the world's DRAM (dynamic random-access memory) used in phones and computers. These firms operate under cycles where capacity expansion takes years to plan and billions in capital investment. When demand suddenly exceeds production capacity—as occurred with artificial intelligence infrastructure buildout—there's no quick adjustment.
Nothing entered the smartphone market in 2023 with the Nothing Phone (1), a device that received critical acclaim for its distinctive transparent design and competitive pricing. By 2025, the company had expanded to multiple market segments and was gaining genuine momentum in Europe and India. The RAM shortage arrived precisely when Nothing had reached scale sufficient to be affected by component costs but lacked the market dominance to negotiate preferential supplier pricing.
Key Facts
- RAM costs increased 20-40% in early 2026 as allocation to AI infrastructure took priority at manufacturing facilities
- Nothing CEO Carl Pei, who previously built OnePlus into a $1 billion revenue company, warned that price increases would be sustained, not temporary
- The shortage particularly affected mid-range phones ($300-$700 segment) because flagship phones could more easily absorb cost increases through premium pricing
- Manufacturing capacity for DRAM typically requires 2-3 years of planning before production actually increases
- Samsung, SK Hynix, and Micron control approximately 90% of global DRAM production
- Analyst estimates suggested base phone prices would increase by $50-$150 within 12 months depending on target market
What People Are Saying
The Nothing CEO says phone prices are going to keep going up resonated differently across different audiences. Technology analysts largely validated the concern, noting that previous semiconductor shortages (2020-2022 during the pandemic) had indeed driven sustained price increases even after physical supply constraints eased. Market researchers observed that consumer sentiment was shifting—for the first time in years, upgrade cycles lengthened as people chose to keep phones longer rather than buy new devices annually.
Within Nothing's own ecosystem, the message created tension. Loyal customers who valued the brand's affordability positioning saw the warning as a breach of the company's core promise. On technology forums and social media, discussions focused on whether mid-range phones would continue offering compelling value or whether they would increasingly resemble budget versions of flagship devices with fewer features but similar price points.
Broader Implications
When the Nothing CEO says phone prices are going to keep going up, the statement reverberates through entire device ecosystems. Smartphones are no longer luxury items in developed markets—they