Gartner forecasts worldwide semiconductor revenue of $1,320.2 billion in 2026, a 64 percent rise the firm calls the highest growth in the last two decades.
Almost all of it is one line item. Memory goes from $216.3 billion in 2025 to $633.3 billion in 2026, an increase of $417.0 billion set against a total market increase of $514.9 billion. Non-memory grows 16.6 percent, which in any other year would be a good cycle and this year is a rounding correction.
Run the share out and memory lands at 48 percent of all semiconductor revenue in 2026, up from 27 percent in 2025. Gartner describes the memory line as increasing threefold. Its own table makes it 2.9 times.
None of that is bits. Gartner estimates DRAM and NAND flash annual prices in 2026 will rise 125 percent and 234 percent respectively, and says meaningful pricing relief is not expected until late 2027.
The NAND figure is the one worth sitting with. Flash is inflating at close to twice DRAM's rate, which is why the firm's summary line reads storage crisis rather than memory crisis, and why anyone buying capacity by the petabyte is having a materially worse year than anyone buying it by the gigabyte.
"Memflation will destroy, or at least delay, non-AI demand into 2028, to varying degrees depending on the application," said Rajeev Rajput, Senior Principal Analyst at Gartner.
That is a demand destruction call, stated as such. PCs, handsets, industrial and automotive electronics do not get to bid against AI accelerators for the same wafers, so the bit supply goes where the margin is and the rest of the market waits two years for the queue to clear.
Rajput added: "CIOs and IT leaders should be cautious about signing supply agreements with unfavourable pricing terms that extend beyond 2027."
Decoded, that is an analyst house telling its buy-side clients not to lock in at the top. His preceding sentence tells suppliers to prepare for higher prices in the first half of 2026 followed by persistent but moderating increases, which is the same curve read from the other end of the table.
AI silicon accounts for roughly 30 percent of total semiconductor revenue on Gartner's numbers, with hyperscaler AI infrastructure spending expected to rise more than 50 percent in 2026. Between AI accelerators and memory inflation, there is not much industry left over to explain.
The forecast does not have memory rolling over afterwards. Memory revenue reaches $748.1 billion in 2027 and the total market $1,554.5 billion, both higher again. Gartner's analysts call memflation profound but not perennial, and the arithmetic backs the second half of that: an 18 percent memory revenue gain in 2027 alongside easing prices at the end of the year only works if bits are finally arriving in volume.
Bootnote: the figures above are the whole of what is public. The forecast sits inside Gartner's client-only research, in this case Forecast: Semiconductors and Electronics, Worldwide, 2024-2030, 1Q26, and a companion note titled How Long Will AI Demand Sustain Memory Prices. Nobody outside the subscription gets to see the supply assumptions underneath a 234 percent NAND price call, which is worth remembering before anyone builds a procurement plan on it.
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