RAM will remain overpriced until 2028: Samsung and SK Hynix refuse to increase production

Order books are overflowing, prices are soaring, but factories are idling. Samsung and SK Hynix, which together manufacture 70% of the world’s DRAM memory, have just announced that they do not really plan to increase their production. A decision which condemns a market in full tension several more years of famine.

An assumed strategy of supply restriction

Samsung clarified its position during a conference with its investors. A spokesperson for the group stated bluntly that the company will prioritize “a strategy for maintaining long-term profitability” rather than a rapid expansion of production capacities. The stated objective is to “minimize the risk of overproduction through a capital spending strategy that balances customer demand and prices”.

This caution is reflected concretely in the figures. Samsung is currently only able to fulfill 70% of the DRAM orders it receives. SK Hynix seems slightly more offensive by announcing an investment equivalent to 30% of its turnover for 2026, with an acceleration of the transition to 1c DRAM technology. But the company immediately tempers by recognizing that it will be “difficult to resolve supply shortage”.

Samsung goes even further by closing the door to long-term contracts. The group refuses to“locking in volumes with a specific customer in a situation where prices are increasing rapidly”thereby depriving buyers of any opportunity to protect themselves against price inflation.

The analysts of Trendforce did their calculations. Memory supply will increase by 23% in 2026, while demand will jump by 35%. The imbalance will therefore worsen. As for Micron, the third major player in the sector, it has just announced on December 3 the outright abandonment of its Crucial consumer business by February 2026.

Sumit Sadana, executive vice president of Micron, justifies this withdrawal by “the growth of the data center driven by AI” who has “led to a sharp increase in demand for memory and storage”. The company now prefers to reserve its production for “strategic customers” rather than the general public market. A new $10 billion factory is planned in Japan, but it won’t produce anything before the end of 2028. Tech Insight logically concludes that the crisis “will continue beyond 2028”.

Behind this reluctance lies a very understandable anxiety. Manufacturers, nicknamed the “Dramurai” in the industry, fear a sudden collapse of the artificial intelligence market. If the bubble were to burst after a massive capacity expansion, they would find themselves with oversized factories and wiped out margins. In the meantime, the entire IT sector is suffering the consequences of this bet on the duration of the euphoria around AI.

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