Quick Facts
- Global memory shortage has doubled component costs for electronics manufacturers including Apple since 2025
- Best Buy reported Q4 revenue of $13.95 billion, down 4.8% year-over-year, but beat analyst expectations
- CEO Corie Barry warns price increases are ‘highly likely’ due to tariffs and component shortages
Best Buy reported fourth-quarter net income of $117 million, or 54 cents per share, compared with $460 million in the prior year. The electronics retailer beat Wall Street expectations with revenue of $13.95 billion versus the expected $13.70 billion, despite a 4.8% decline from last year’s $14.65 billion.
The retailer faces mounting pressure from what industry analysts call ‘RAMmageddon’ – a global memory shortage that has driven component costs up dramatically. Every electronics manufacturer now pays twice as much for RAM and flash storage as in 2025, and 10 times more than in 2020.
DRAM prices rose 172% throughout 2025 as manufacturers reallocated production capacity from consumer products to high-margin AI infrastructure components. High-Bandwidth Memory for AI servers requires about three times the wafer capacity of standard DRAM per gigabyte, according to Micron.
Best Buy CEO Corie Barry downplayed the shortage during the earnings call. ‘It is something that we have dealt with in peaks many times over the last 25 years,’ she said. ‘Our vendor partners are really excellent at pivoting and thinking differently.’
Barry warned that price increases are ‘highly likely’ as President Trump’s tariffs take effect. China and Mexico supply 55% and 20% of Best Buy’s products respectively. She projected a 10% China tariff would decrease comparable sales by 1%.
Samsung memory executive Kim Jaejune told analysts a ‘significant shortage of memory products across the board is expected to continue for the time being.’ SK Hynix expects DRAM supply constraints through 2028.
Apple CEO Tim Cook said the company expects memory pricing to increase significantly. The shortage could cost Apple $2 to $3 billion extra per quarter, potentially forcing product price increases.
Technology companies including Google, Amazon, Microsoft and Meta placed open-ended orders with memory suppliers, accepting any available supply regardless of cost. OpenAI’s partnership with Samsung and SK Hynix for its Stargate Project will consume up to 40% of global DRAM output.
Best Buy’s comparable sales rose 0.5% year-over-year for the quarter, excluding an additional week in fiscal 2024. The company must navigate both supply constraints and tariff impacts as memory prices continue climbing.
