Global demand for AI hardware is putting pressure on the memory market. According to OVH CEO Octave Klaba, this will not only lead to rising component costs, but ultimately also to higher cloud prices.
Manufacturers are shifting their capacity to the much more profitable memory types used in GPUs, reducing production for the rest of the market. Klaba writes this in a post. This is putting pressure on the prices of all types of memory and storage, according to Klaba.
OVHcloud expects identical servers to be between 15 and 35 percent more expensive in December 2026 than they were a year earlier. Klaba explains that the global supply chain is trying to temper price increases by purchasing components 6 months earlier at lower prices. This temporarily allows manufacturers to build more cheaply for months to come, but at the same time, ensures that prices will start to rise as early as December 2025.
Spot prices are rising rapidly
Klaba’s statements are confirmed by TrendForce, which reports that spot prices for memory have risen exceptionally quickly in recent months. According to the research firm, DDR5 and NAND components in particular are showing strong price increases, which aligns with the picture that market capacity is shifting towards AI memory and that other segments are therefore experiencing shortages.
The Register reports that rising costs are raising questions about the possible repatriation of workloads from the cloud, but analysts do not yet see a broad movement in that direction. Previous cases where companies brought their infrastructure back to their own data centers show that this can be financially rewarding, but The Register emphasizes that these projects did not involve AI servers. When it comes to AI hardware, many organizations do not yet have the experience to manage such systems themselves, while large cloud providers also have earlier access to scarce GPUs. Higher prices, therefore, do not seem to be a direct reason for many companies to remove AI workloads from the cloud.
According to Klaba, the impact on the cloud sector will not be limited. Certain cloud products are expected to increase in price by approximately 5 to 10 percent between April and September 2026. These are forecasts based on information available to OVHcloud in November 2025. Klaba warns that this trend may accelerate further.