- The boss of SK Hynix believes that the RAM crisis is going to get much worse
- The CEO said 2027 will be the 'worst year' in the RAM industry's history, and that the crisis will likely roll on to 2030 and beyond
- Analysis from the Bank of America also claims that SK Hynix's expansion of memory production capacity is going to fall well short of its target for 2028
We keep getting told that the RAM crisis is dug in as a fixture for the foreseeable future, and, whether you want them or not, here are a couple more unwelcome reminders.
First, Android Headline flagged a Reuters interview with Kwak Noh-jung, the CEO of SK Hynix, one of the big memory chip makers. The chief executive didn't have comforting words about the prospect of RAM pricing in 2027, observing, "We forecast that next year will be the worst year in the [memory] industry's history from the supply perspective."
So, seemingly next year will see RAM hit peak pricing, with no relief likely until 2030 (as previously forecast by the chairman of parent company SK Group) according to the CEO — and even then, he suggested that demand will continue to outweigh supply as the next decade rolls on beyond 2030.
The second RAM-related blow comes from analysis by the Bank of America highlighted by the Commercial Times in Taiwan (via Wccftech), which pours doubt on the South Korean president's recent boasts about the major expansion of the country's overall memory chip production by 2030.
Part of this analysis is a claim from a memory industry insider over in Taiwan that SK Hynix might only add just a sixth of its originally planned production capacity increase by 2028. Obviously that assertion needs to be liberally seasoned, but it's such a large potential shortfall that it's bound to raise some eyebrows.
The Commercial Times notes that while huge new chip manufacturing plants are being built by SK Hynix and Samsung in South Korea, they will take a lot longer than 2030 to come fully online — and this process is more likely to take a full decade. The report contends that a realistic level of memory wafer capacity expansion for South Korea is around 10% (or slightly less) per year, which will leave the country falling well short of the president's claims for production in 2030.
Analysis: diverging RAM timelines
It's grim news from the CEO of SK Hynix, then, although of course, the skeptics will quickly point out that it's the chief exec's job to talk up the company's value — in terms of a booming market and the struggle to meet demand — coming off the back of its debut on the Nasdaq. Stock prices around the big memory chip makers have been turbulent of late, it should be noted, as investors start to worry about whether these companies are currently overvalued — and indeed whether the AI boom might start to run out of momentum.
So, that's a consideration, but there's no denying that SK Hynix's boss isn't the only person making gloomy predictions along these lines. Nvidia's CEO Jensen Huang said that he expects the RAM crisis to last "quite a few years", indicating that we'll be stuck in pricing hell until 2030 or thereabouts, although others don't see it that way. In the opposing camp we notably have the likes of an AMD exec, the ex-chief of Samsung's semiconductor division, and Jefferies, an investment banking firm, who all believe RAM pricing will start to ease in 2028.
However, the sting in the tail there is that Jefferies is also predicting big memory price hikes over the rest of this year, and in 2027 too, backing up the CEO of SK Hynix in that respect. When you consider the estimated massive shortfall of SK Hynix's production capacity boost based on the rumor mill, everything feels distinctly shakier in the nearer-term for RAM pricing.
I also can't help but recall the blow Microsoft recently delivered when talking about Xbox price rises, when the company informed us that it expects another doubling in the cost of RAM in just over a year (by the fall of 2027).
While there's a mixed bag in terms of longer-term predictions, then, the outlook for this year and next remains worryingly negative on the RAM front.
from Latest from TechRadar US in Computing News https://ift.tt/SFhr2Od
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