‘Supply will remain substantially short of the demand for the foreseeable future.’
‘Supply will remain substantially short of the demand for the foreseeable future.’
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Micron, one of the three biggest memory suppliers in the world, forecasts rough months ahead for the global RAM supply. As part of its earnings report released on Wednesday, Micron CEO Sanjay Mehrotra said “tight industry conditions” across DRAM and NAND flash memory are expected to “persist through and beyond” 2026 as AI drives up demand.
With the AI boom in full swing, Micron is making more money than ever as companies like OpenAI, Meta, Microsoft, and Google fill their data centers with powerful chips that come packaged with high-bandwidth memory (HBM). It once again reported record revenue of $13.64 billion this past quarter, a sizeable jump from the $8.71 billion it made at the same time last year.
Micron just shuttered its consumer-facing business, Crucial, as it prioritizes far more lucrative deals involving HBM technology, which uses three times the silicon wafers compared to standard DRAM. That leaves fewer resources for the DRAM in products we use every day, like PCs, smartphones, smart TVs, and even cars. It has already started driving up prices of DDR5 RAM kits, with other devices expected to be impacted soon.
“Over the last few months, our customers’ AI data center build-out plans have driven a sharp increase in demand forecast for memory and storage,” Mehrotra said during the earnings call, adding that “supply will remain substantially short of the demand for the foreseeable future.” Micron said in its earnings report that these “memory supply constraints” may affect PC shipments next year.
Micron aims to ramp up production and expects to increase its shipments of DRAM and NAND flash memory by 20 percent next year, but that still isn’t enough to keep up. “Despite significant efforts, we are disappointed to be unable to meet demand from other customers across all market segments,” Mehrotra said. Micron also expects to start production at a new manufacturing facility in Idaho in 2027, followed by a new plant in New York in 2030.