AI Boom Drives 40% Surge in Personal Computer Prices in Israel

Personal computer prices in Israel have surged by approximately 40% within less than a year, rising from around 1,990 shekels last summer to about 2,800 shekels currently, according to research firm STKI. This sharp increase is attributed to the global demand for advanced AI infrastructure, which has redirected semiconductor production lines towards AI data centers, causing a shortage of memory chips and storage components essential for standard PCs.

STKI's market study, involving over 250 organizations, highlights that until 2025, PC prices remained relatively stable except during the COVID-19 pandemic. However, since October last year, the market has experienced significant price hikes due to manufacturers prioritizing AI-specific memory chip production over regular components. STKI's Vice President, Pini Cohen, explained that this shift has led to a worldwide shortage impacting the entire supply chain, from factories to end consumers. Additionally, suppliers have stopped committing to fixed prices in advance, finalizing costs only upon shipment.

The crisis affects both business and consumer sectors, with reports of suppliers failing to honor price agreements, order cancellations after payment, and shortened validity periods for price offers to as little as 10 to 30 days. Delivery delays have become commonplace, making the market volatile and unpredictable. STKI projects that prices may only begin to decline by mid-2027 at the earliest, as establishing new chip production lines takes about 18 months. However, there is no guarantee that prices will return to pre-crisis levels.

This ongoing shortage and price inflation reflect the broader impact of the AI revolution on global technology supply chains, underscoring the challenges consumers and businesses face in acquiring computing hardware amid soaring demand for AI infrastructure.