DRAM Prices Not Expected too Peak Until 2026, Analyst Says
If you were hoping for some relief from stratospheric memory pricing, don’t hold your breath. DRAM prices aren’t expected to peak until at least 2026, TechInsights analyst James Sanders tells The Register.
DRAM is an incredibly broad category and includes everything from the DDR5 found in desktops and servers to the GDDR7 and HBM used by graphics cards and AI accelerators.
The market is also notoriously volatile and prone to wild swings in pricing, spiking as inventories are drawn down and cratering as new capacity is brought online, Sanders explains.
as chip markets go, DRAM is about as volatile as they get.
According to TechInsights,memory pricing was already on the rise in 2024,growing 88 percent from a rather steep valley the year prior.Based on previous DRAM booms, one might expect it to grow at a slower pace in 2025, before contracting in 2026 or 2027.
However, Sanders tells us that’s unlikely to happen this time around. “I think we’re looking at the peak in 2026,” he said, adding that even then he only expects DRAM prices to settle in 2027 before rising again in 2028.
DRAM Shortage: AI Demand and a Three-Year Capacity Catch-Up
The current DRAM shortage is a complex issue rooted in timing and surging demand,particularly from the artificial intelligence (AI) industry. Building new manufacturing capacity isn’t a quick fix, with a lead time of roughly three years, making it financially challenging to respond rapidly to market needs.
according to industry observers, major DRAM vendors like Samsung, SK Hynix, and Micron face a four to five-year ramp-up period for new fabrication plants (fabs). By the time that capacity comes online, market conditions could shift considerably. This lengthy process contributes to the current supply constraints.
The impact of the shortage isn’t uniform. The consumer market is experiencing the most acute effects, while Original Equipment Manufacturers (OEMs) like dell and HP are somewhat insulated due to pre-arranged orders. Smaller vendors, though, are more vulnerable to volatile spot pricing.
G.Skill, a memory supplier for gamers, recently attributed price increases directly to AI-driven demand.In a statement, the company cited “severe global supply constraints and shortages” and “unprecedented high demand from the AI industry” as factors driving up procurement costs, leading to price adjustments. the statement highlighted that G.Skill’s pricing reflects broader component cost increases from IC suppliers and is subject to change based on market fluctuations.
AI Demand drives Memory Market Divergence, with HBM Leading the Charge
The memory market is undergoing a significant conversion driven by the explosive growth of artificial intelligence (AI), creating a widening gap between high-bandwidth memory (HBM) for AI applications and traditional DRAM for consumer products. This divergence is leading to price increases and supply constraints, particularly for HBM, while also introducing new dynamics with the emergence of Chinese memory manufacturer CXMT.
The Rise of HBM and a Two-Tiered Market
Demand for HBM, crucial for powering advanced AI chips like Nvidia’s Blackwell (formerly known as Rubin) and AMD’s MI400 series, is surging. This demand is fueled by the need for faster memory access in AI workloads. According to TechInsights analyst Dan Sanders,the consumer market simply cannot absorb the high cost of HBM,leading to a split in the memory landscape. “Becuase there’s no consumer demand for HBM – the consumer market can’t bear that price at all – it is really becoming two markets that are detached from each other,” Sanders stated.
The transition to HBM4 is currently underway, with initial chips utilizing the technology expected to command a premium price. Nvidia’s aspiring plans to deploy systems with 576 Rubin-Ultra GPUs, each equipped with a terabyte of HBM4e memory, in a single rack by 2027 further underscores the escalating demand and specialized focus on HBM. https://www.theregister.com/2024/06/13/nvidia_blackwell_gpu_launch/
Supply Shortages and Price Increases
The imbalance between supply and demand is already impacting prices. Micron CEO Sanjay Mehrotra recently reported that industry supply is “substantially short of the demand for the foreseeable future” due to strong AI datacenter demand. https://www.theregister.com/2025/12/18/micron_q1_2026/ End customers are experiencing price increases, with memory costs tripling in just a few months.
Despite these challenges for consumers, memory manufacturers are benefiting significantly. Micron’s Q1 2026 earnings call revealed a 56% revenue increase and a doubling of net income to $5.24 billion, up from $1.87 billion the previous year. However, expanding production capacity takes time – at least three years – and new fabs are likely to prioritize HBM and other enterprise-focused products.
The Wildcard: CXMT
China’s CXMT represents a potential disruptor in the memory market. Currently, CXMT has limited HBM output and has been subject to United States export controls.However, the company is shifting its focus from DDR4 to DDR5, a move that surprised some analysts.TechInsights anticipates CXMT will grow to capture 5-10% of the market by the end of the decade, potentially increasing the overall supply of DDR5.https://www.theregister.com/2024/05/23/cxmt_ddr5_ram_plans/
Looking Ahead
While the memory market is expected to stabilize in 2027, the long-term trajectory points towards continued specialization and strong demand for HBM driven by the relentless advancement of AI.The interplay between established players like Micron, Samsung, and SK Hynix, and the emergence of companies like CXMT, will shape the future of memory technology and its availability in the years to come.
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