RAM now represents 35 percent of bill of materials for HP PCs

In an illustration of the severity of the current memory shortage, HP Inc. CFO Karen Parkhill said that RAM has gone from accounting for “roughly 15 percent to 18 percent” of HP PCs’ bill of materials in its fiscal Q4 2025 to “roughly 35 percent” for the rest of the year.

Parkhill was speaking during HP’s Q1 2026 earnings call, where the company said it expects the total addressable market for its Personal Systems business to decline by double digits this calendar year, as higher prices hurt customer demand.

“We have seen memory costs increase roughly 100 percent sequentially, and we do forecast that to further increase as we move into the fiscal year,” Parkhill said, per a transcript of the call by Seeking Alpha.

HP expects its financials to be most severely impacted by the RAM shortage in the second half of its fiscal year.

“We are seeing increased input costs driven primarily by the rising prices of DRAM and NAND,” Bruce Broussard, HP’s interim CEO and director, said. “We expect this volatility to remain throughout fiscal [year 2026] and likely into fiscal [year 2027].”

RAM shortage drives higher prices, lower specs

HP’s CFO noted that a third of the margin for HP’s Personal Systems business comes from non-RAM-related categories, including IT services and peripherals. However, HP has also raised PC prices to keep making money while paying significantly more for RAM.