Europe Faces Rising Prices as AI Drains Memory Chips

Europe is about to feel the pinch of a global memory chip shortage. Currys, Britain’s biggest electronics retailer, has warned that prices for gadgets will rise later in 2026. Smartphones, laptops, and TVs are the main items at risk.

The shortage is driven by the huge demand from AI and data centers. These systems need massive amounts of silicon, the key material in memory chips. Currys CEO Alex Baldock explained, “AI and data centres are eating up the world’s supply of silicon.”

Because memory makers are shifting production to AI hyperscalers like Meta, Google, and Amazon, fewer chips are left for mobile phones and laptops. Baldock said, “Less (is) left over for the likes of mobile phones and laptops and that inevitably will cause availability challenges and some cost price inflation coming through later this year.”

To prepare for this, Currys has increased its inventory by £140 million. This stock boost secures supplies through the busy back-to-school and autumn periods. Baldock assured, “We’ve made sure that we’ve bought forward, so we’ve got good security of supply in computing and mobile phones until at least September.”

Financial Results Reflect Growth Despite Challenges

Currys reported an adjusted pre-tax profit of £191 million for the year ending May 2, 2026. The company’s revenue reached £9.25 billion. Like-for-like sales grew 3% in the UK and Ireland, and 6% in the Nordics.

Looking ahead, Currys expects an adjusted pre-tax profit of around £198 million for the 2026/27 financial year. Despite these strong results, the company’s shares fell 3.3%, trimming the year’s gains to 25.6%.

Leadership Changes and Industry Concerns

Alex Baldock announced he will leave Currys on August 31 to become CEO of Boots, a health and beauty retailer. Fredrik Tønnesen, who leads Currys’ Nordic business, will take over as group CEO.

Beyond Currys, Europe’s chip industry faces other challenges. An EU-funded report warned that Chinese export controls and Europe’s reliance on U.S. technology put the region’s chip sector at risk. Without stronger domestic production, the future for Europe’s chip industry looks bleak.

This shortage is not just about supply. It signals a shift in global priorities. AI and data centers are fueling a trillion-dollar opportunity, but also squeezing traditional markets. Consumers should expect higher prices on electronics as supply tightens. Apple has already raised prices on several products in response.

In short, the AI boom is reshaping the chip market. It’s driving up costs for everyday devices. Europe’s shoppers will soon notice the impact in stores and online.