As memory shortage persists, vendor price quotes are not long remembered
HPE and Cisco are adjusting terms and conditions
If you like the price of that server, PC, or storage array, you'd better act fast.
The spiraling cost of computer memory is forcing hardware vendors to shrink the time a quoted price is honored, as AI buildouts fueled by huge capital expenditures are causing massive shortages, analysts with IDC told The Register.
“For memory customers, price negotiations have been challenging given limited availability,” said Jeff Janukowicz, research vice president at IDC. “Suppliers are allocating constrained supply and prioritizing segments that are willing—or able—to absorb higher pricing. This dynamic has led to ongoing price discovery across the market and the renegotiation of pricing contracts.”
Compared to just a few months ago, pricing for many memory products has nearly doubled, he said, which will affect both consumer and commercial electronics markets.
Both Cisco and HPE have adjusted the time they are allowed to change prices or cancel orders in response to the shortage. Cisco told channel partners this week it can now cancel compute orders up to 45 days before shipment. Cisco may also adjust compute order pricing between the order date and the shipment, and it may reduce price protection on deals, according to CRN. Cisco did not reply to an email from The Register seeking comment.
HPE has also cut the expiration date of its quotes in half, leaving customers with 14 days to decide, down from 30 days. This reportedly excludes public sector, B2B, and OEM customers, and the company has updated the contract terms and conditions for server and GreenLake orders to allow price adjustments until the date of shipment.
HPE spokesman Adam Bauer told us that any action like this would be “rare and only in response to material increases in forecasted commodity costs.”
In an email provided to The Register and other media outlets, HPE’s Simon Ewington said this is being done in response to “significant constraints” on components worldwide.
“This is a fluid environment, and we are working hard to respond to it while helping our valued customers and partners understand what to expect,” Ewington wrote.
Janukowicz told The Register IDC sees no sign of slowing demand, particularly as cloud providers have upped their expected spend on data center projects in 2026, with AWS, Google, Meta, and Microsoft telling investors recently they expect to spend a collective total of more than $600 billion to construct AI projects.
“Compared to just a few months ago, pricing for many memory products has nearly doubled. We’re operating in an environment where memory supply is extremely tight, driven by continued growth in AI infrastructure demand,” he said. “While AI headlines often focus on compute, realizing the benefits of AI also requires substantial memory and storage to feed and support that compute. Because memory is pervasive—spanning PCs and smartphones to the data center—the impact is broad-based.”
While Intel CEO Lip-Bu Tan said earlier this month that he expects memory shortages to last until 2028, Janukowicz said IDC expects prices to moderate later this year.
“However, as long as AI demand remains robust, demand for memory should continue to be strong,” he said. ®