Memory suppliers caught between AI boom and consumer DRAM shortages as market dynamics shift

Micron explains why Crucial SSD and memory exit won't leave users stranded

Adjusting production for different DRAM sizes can reduce total output Micron has addressed criticism following its recent decision to retire the Crucial SSD and memory brand, clarifying the company is not abandoning consumers entirely. The announcement comes after months of speculation that Micron is prioritizing enterprise-grade DRAM and storage for AI projects, leaving PC builders and hobbyists facing supply shortages and rising prices. In a recent WCCFtech interview, Christopher Moore, Micron's VP of Marketing for Mobile and Client Business, emphasized that the company continues to supply memory to OEMs, including LPDDR5 modules for laptops, while reallocating resources toward high-demand enterprise sectors. Moore acknowledged the growth of data centers and AI demand has dramatically shifted the market, with enterprise requirements now consuming 50% to 60% of the overall memory supply. He noted this is not solely a Micron issue, as the entire industry is experiencing shortages, forcing manufacturers to prioritize output where it is most needed. Adjusting production for different DRAM sizes can reduce overall output, and Micron is working with customers to stabilize demand so that supply can be maximized across all segments. Micron's move is part of an AI-focused pivot, which includes ramping up enterprise SSD production and dedicating a significant portion of its output to AI compute infrastructure. Moore emphasized that the company remains committed to consumers, stating that they are being served through different channels, with ongoing shipments of memory and portable SSD solutions through major OEMs. The company maintains its partnerships with PC brands like Dell and Asus to ensure that consumer devices still receive DRAM and storage modules. It has also been expanding production capacity, including its ID1 facility in Idaho and a $100 billion megafab in New York. Moore clarified while these projects will increase output, meaningful production is not expected until 2028, after qualification and customer acceptance. For consumers, this means that DRAM shortages and elevated prices may persist for several years, particularly for DIY builders or those seeking upgrades with higher-capacity SSD or memory modules. Micron is on its toes to ensure that it serves customers better because suppliers in China and elsewhere have helped strengthen the industry. This competition is healthy, and it will probably help the DRAM market to bounce back. Micron is technically still supporting the consumer market, but it is hard not to notice that the company is shifting toward AI and enterprise memory. It clearly prioritizes large-scale infrastructure, leaving individuals and hobbyists to face supply constraints for the foreseeable future.

SK hynix Denies Rumors of Exiting the Consumer Business for Now, but the DRAM Supply Situation Looks Deteriorating With Time

SK hynix has responded to rumors that the company is exiting the consumer business, stating that the Korean giant has no such plans for now. The ongoing memory shortages have disrupted the consumer/AI supply chains to the point where suppliers, such as SK hynix and Micron, are forced to make aggressive decisions to fulfill market demand. One of the major shocks to the consumer industry was Micron's exit from the Crucial business, which prompted rumors that competitors like SK hynix would follow suit. We reached out to SK hynix to inquire about the company's stance on whether it will continue its consumer business, and they rejected such rumors, stating that the business remains intact. SK hynix is not considering discontinuing its consumer business. - SK hynix spokesperson While the statement is concise, it does put an end to existing rumors about supply chain uncertainity, as the OEM business for companies like Micron and SK hynix still accounts for a fair share of the company's DRAM revenue. While the demand from the AI industry has grown aggressively, manufacturers like AMD and Intel, along with their respective AIB vendors, are still experiencing strong demand for DRAM products, as the consumer channel isn't expected to slow down for now. In our talk with Micron, it was evident that memory suppliers find it more worthwhile to cater to the demand coming from the AI segment, given the rapidly increasing TAM figures, along with how products like HBM bring in a much higher profitability percentage, relatively to general-purpose DRAM products. However, memory suppliers still aren't looking to give up on their consumer businesses, but maintaining the balance alongside AI has become difficult for them, given the supply shocks they are seeing. It would be interesting to see how the memory situation evolves moving forward, especially considering that DRAM demand from AI customers isn't expected to slow down anytime soon.