SK hynix warns DRAM supply will remain tight through 2028 as AI demand reshapes memory market

SK hynix internal analysis warns DRAM supply growth will be tight until 2028

TL;DR: SK hynix forecasts ongoing DRAM supply shortages and high prices through 2028 due to limited consumer market growth and rising AI server demand. Conservative capacity expansion prioritizes profitability amid low inventories, fueling a DRAM super-cycle driven by AI data center growth and escalating server memory needs. SK hynix is expecting DRAM supply issues (and high prices, and probably even higher price than now) through until 2028, lining up with other reports suggesting we'll be in pain for the next 2-3 years when it comes to RAM and SSDs. In a new post on X by user @BullsLab who shared some screenshots of a purported internal analysis by SK hynix, the South Korean memory leader projects that growth for the commodity DRAM will be constrained until at least 2028... but not for HBM and SOCAMM memory modules. This is because SK hynix has been busy shifting its focus to fulfill the demand of AI servers, where there are masses of profits to be had, and that the possibility of any decent growth in the production capacity for the consumer market remains low. The existing supplier inventories are reported to have been drawn down to historically low levels, which is putting even more pressure on allocation. Reports suggest that memory makers including SK hynix have begun using conservative capacity expansion strategies, which will work towards maintaining profitability over flooding the market with new DRAM supply, while server DRAM demand has been growing close to exponentially, and growth is expected to be even sharper in 2026. Estimates of server shares are set to increase 38% in 2025 to a much bigger 53% by 2030, and thanks to the AI boom, there is an explosion in AI training data center buildouts across cloud service providers (CSPs), and this demand is expected to result in a "DRAM super-cycle". DRAM production slots for 2026 are reportedly sold out already, with traditional PC DRAM production expected to fall short of demand for the next few years through to 2028.

Here's What One of the Largest DRAM Suppliers, SK hynix, Has to Say About the Ongoing Memory Shortage and the Efforts Being Made to Sort It Out

Memory shortages have disrupted the industry on a much broader scale, and given the uncertainity of the situation, we managed to reach out to SK hynix to know about the on-ground reality of the DRAM supply chain. Consumers should be aware of how aggressive DRAM shortages are expected to unfold in the future, as several products, including laptops, PCs, mobile phones, and memory-related devices, are likely to become more expensive. More importantly, we have seen estimates that delve into when memory shortages are expected to continue, and by far, it appears that we are in for a difficult time, up to and beyond 2027. We reached out to SK hynix to request a comment on the ongoing 'memory supercycle' and the efforts being made to mitigate supply chain constraints, and here's what they had to say: SK hynix has completed two(2) years of construction on its new M15X fab and opened it ahead of schedule. The M15X fab, dedicated to HBM production, is set to begin full-scale mass production next year. Given that memory demand is increasing more sharply than previously anticipated, we are proactively securing 'fab space' and 'production capacity' through the establishment of advanced production infrastructure, including M15X and the Yongin fab, which is set to open in the 1st half of 2027. This will enable us to efficiently respond to the growing demand for AI memory and evolving customer needs. The company informed us that commenting on memory shortages and their duration is premature at this time, given that the supply chain is still adjusting to the situation, and we are uncertain about the potential demand from the AI sector. When we inquired about the company's efforts to upscale DRAM production, the firm mentioned its M15X facility, which is one of the biggest projects by the firm, projected to cost around $3.6 billion. The M15X fab is expected to be dedicated to HBM production and will contribute a significant portion of the company's overall wafer output per month. Ultimately, SK hynix projects adding a massive bump in DRAM production capacity by H1 2027, which will help them cater to market demand. Another interesting question we asked the Korean giant was about customer diversification, specifically whether the firm prioritizes one segment over another, as this is a concern for consumers. The firm couldn't dive into the specifics, but they did disclose to us that DRAM production lines cater to a "diverse range of customers", and they are putting in efforts to respond to the entire market demand. SK hynix will continue to maintain a high market share in HBM not only from major GPU customers but also from diverse range of customers, including ASIC segments. Leveraging our product competitiveness and customer trust, we will collaborate with customers on next-generation product development to contribute to the advancement of the AI industry. To that end, SK hynix is actively expanding our production capacity through new fab projects such as M15X and the Yongin fab to proactively respond to market demand. There's little space for DRAM producers to act upon to cater to shortages, given that expansion of facilities and re-allocation of production lines is a process that takes several months. And, given that large-scale CSPs and tech giants are looking to be involved in long-term DRAM contracts, this ultimately puts the general-purpose segment at a disadvantage. It would be interesting to see how the situation turns out for gamers, but by the looks of it, consumer product prices are likely to worsen from here on.

SK Hynix Warns DRAM Supply Growth Will Lag Demand Through 2028

DRAM supply tightness is now expected to continue through 2028, according to one of the world's largest memory makers. The mainstream PC market is bracing for a prolonged memory supply-demand imbalance, which is reportedly going to exist throughout 2028. SK Hynix's internal analysis shows that the "commodity" DRAM will see limited growth and won't catch up to the demand. We already know how bad the DRAM prices are, but this situation appears to have gone out of hand, making it extremely difficult for the masses to get affordable PCs. The user @BullsLab shared screenshots of what is reported to be an internal analysis by SK Hynix. It projects that, except for the high-bandwidth memory (HBM) and SOCAMM modules, the growth for the commodity DRAM will remain constrained through at least 2028. This is because the major memory makers have already shifted their focus to fulfill the demands of AI servers, and the likelihood of seeing any noticeable growth in the production capacity for the consumer market remains low. The existing supplier inventories are reported to have been drawn down to historically low levels, which is further intensifying allocation pressures. Reports show that memory makers such as SK Hynix have adopted conservative capacity expansion strategies, which focus more on maintaining profitability rather than flooding the market with new DRAM supply. The server DRAM demand has been growing almost exponentially, and it's expected that the growth will be sharper next year. It's estimated that the server share will increase from 38% in 2025 to a whopping 53% by 2030. Due to the AI boom, there is a big surge in AI training data center buildouts across cloud providers, and this demand is expected to result in a DRAM super-cycle. Some reports also suggest that manufacturers have already sold out key DRAM production slots for 2026, while the traditional PC DRAM production is expected to fall short of demand for the next few years. We have already seen a surge in the AI PC market share, and it's expected that the AI PC systems will account for around 55% of the total PC market in 2026. This is despite the overall PC shipments projected to be equivalent in 2025. Coming to the NAND memory, SK Hynix's analysis also reveals that the NAND supply growth may lag demand in the consumer market due to higher demand from the server side (and higher profits). All in all, this analysis shows a really worrying trend for the consumer market. We previously expected it to last until 2027, but it doesn't seem to be stopping before 2028 ends.