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SK Hynix CEO Warns 2027 Will Be Memory's 'Worst Year' Ever. Shortages May Outlast the Decade (wccftech.com) 66

Posted by EditorDavid from the chipping-away dept.
The CEO of SK Hynix, one of the three largest DRAM producers, predicted to Reuters that the memory industry will see its "worst-ever" supply shortages in 2027, reports the hardware/gaming news site Wccftech: SK Hynix has also forecasted that, given the current market demand, they will fall way short of fulfilling the market demand, and that will continue beyond 2030. The comments from SK Hynix are in line with what Samsung and Micron executives have already said. Samsung has warned of 2027 being the worst year in terms of shortages and that things will continue this way till 2028 and beyond. Meanwhile, Micron has said that the current shortages are only the "first innings" and that both DRAM/NAND supply will be tight, as they are only able to meet 40-50% of the total market demand in the coming years.

Heightened demand from AI customers and multi-year agreements further put pressure on the market. The big three DRAM makers have already prioritized premium DRAM segments such as HBM and LPDDR5X, while commodity memory such as DDR5, DDR4, and entry-level LPDDR RAM has taken a back seat. While these have boosted the profits of SK Hynix, Micron, and Samsung, they have devastated the consumer segment, which is facing the worst kind of price hikes that are affecting all sorts of components and platforms, including PCs, Smartphones, Consoles, etc...

SK Hynix, like Samsung and Micron, is also preparing to embark on a multi-year and multi-billion dollar expansion plan with new fabs and facilities being laid out across South Korea. SK Hynix is also considering the construction of Fabs in the US, Japan, and Southeast Asia, though the final plans are yet to be cemented. Micron recently started construction of its new facility that will be used for DRAM production. As SK Hynix proudly marks its Nasdaq debut, its CEO's sobering forecast serves as a clear reminder: the memory industry is entering its most challenging chapter yet. With 2027 poised to bring the worst supply shortages in history and tight conditions likely persisting beyond 2030, the AI boom is reshaping the entire semiconductor landscape.

SK Hynix CEO Warns 2027 Will Be Memory's 'Worst Year' Ever. Shortages May Outlast the Decade More | Reply

SK Hynix CEO Warns 2027 Will Be Memory's 'Worst Year' Ever. Shortages May Outlast the Decade

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  • This AI thing can go downhill in a week or less (Score:5, Informative)

    by itsme1234 ( 199680 ) on Sunday July 12, 2026 @02:02PM (#66234756)

    ... not that you'd want that with the way they're entrenched in all the financial everything going around us but it's possible for this to pop way faster than it built up.

  • I need to buy a new virtualization server and the RAM costs 3X-5X what the actual server costs. It's ridiclous.

    • I just need some gently used sas drives for a zfs array but even used storage is going for bullshit prices.

    • It is. And the market is ultimately going to push back. I will have zero sympathy when the the value of these companies comes crashing back down when reality returns to the market.

  • It's not like RAM manufacturers don't have a choice who they sell to or how much. The shortage is on them.

    • yeah, but it's also the end of PC sales for a few years unless you have $10000 to splash

      • Re: (Score:1)

        by 0123456 ( 636235 )

        That's a feature, not a bug. They want to end general-purpose home computing and rent computer time to us instead (if our social credit score is high enough)

        Starting to think I should buy another DGX Spark while they're still cheaper than a new car.

      • Re: (Score:2)

        by gweihir ( 88907 )

        Hyperbole much?

    • Re:Stop selling it to AI datacenters (Score:5, Insightful)

      by alvinrod ( 889928 ) on Sunday July 12, 2026 @03:03PM (#66234856)
      Why shouldn't they sell to whoever is willing to pay them the most? At best a few honest people get some cheap RAM and a bunch of scalpers make a tidy profit selling the RAM they bought to the data centers. At least if the manufacturers are the ones making the additional money they can invest back into production capacity. The same cannot be said when it's the scalpers who are soaking up the excess money being left on the table.
      • The HBM memory that's being allocated for AI compute is a different form factor and it's not straightforward to repurpose that for more conventional applications. That changes what they're putting on wafers, so it's not an A or B thing in terms of who's buying save for the latest generation or two of machines that yse directly soldered HBM memory. (Macs, intel core ultra machines)

      • Why shouldn't they sell to whoever is willing to pay them the most?

        To maintain a healthy market. We know SK Hynix doesn't care about maintaining a healthy market, but it seems to me that someone else should.

    • It's not like RAM manufacturers don't have a choice who they sell to or how much. The shortage is on them.

      Errr "shortage" is a "shortage". When you have to choose who to sell something to you, you have a shortage.

      • It's not like RAM manufacturers don't have a choice who they sell to or how much. The shortage is on them.

        Errr "shortage" is a "shortage". When you have to choose who to sell something to you, you have a shortage.

        You ignored the "or how much" part of SniffTheGlove's post. And there's the rub.

        Businesses control supply of their products in order to maximize profits. They do the math, taking all factors of the market into account, in order to set the "how much" part. Right now, people want memory. Desperately. And businesses have set price -- and supply -- accordingly. Controlling supply just the right amount lets them keep prices at a level that maximizes their profits.

        You'll see prices come down when demand goes down

        • You ignored the "or how much" part of SniffTheGlove's post.

          Oops, sorry. That was GrahamJ, not SniffTheGlove.

        • I mean that's a great conspiracy, and the RAM industry has known to act as a cartel in the past, but there is literally zero evidence for that right now. By all accounts both from companies, analysists and 3rd party suppliers all RAM producers are producing at full capacity.

          The only "control" of supply right now is the choice of whether to invest in more capacity.

          They do the math, taking all factors of the market into account, in order to set the "how much" part.

          In virtually all cases save for a carefully coordinated cartel (for which again, there's zero evidence right now) the math part works out to be "a

    • Itâ(TM)s like the Irish potato famine. They raised the potatoes in Ireland. There would not have been a famine if all of the potatoes didnâ(TM)t go to England.

    • Yeah, like you would stop selling your product to the ones that buy in bulk AND still the full price, that would be a bad business decision/practice. Consumers have always just been a sideline, never really the main business.

    • Re: (Score:2)

      by gweihir ( 88907 )

      I think you just failed economics 101: Supply and demand and its impact on prices.

  • Boom and Bust (Score:5, Informative)

    by mistergrumpy ( 7379416 ) on Sunday July 12, 2026 @02:29PM (#66234794)
    While the current situation seems unprecedented, semiconductor manufacturing has been a cyclical boom-bust business for pretty much forever. Ramp up as fast as possible for a year, make a giant backlog of parts the next year, lay almost everyone off, and then in another year start the cycle over. I'm glad I was able to work on the edges of the field and avoid the worst of it.

    • Re: (Score:2)

      by Z00L00K ( 682162 )

      You mean "Pump and Dump"

      • You mean "Pump and Dump"

        No doubt that is some of what's happening now, but I don't think it's all about stock price. I'm pretty convinced the both the memory and logic companies are going to build a bunch of new fabs, make more parts than they've ever made only to have demand drop to more sensible levels.

      • Not exactly because there's a tangible asset at play rather than useless penny stocks

      • Re: (Score:2)

        by gweihir ( 88907 )

        No. There is actual (re-)tooling, building of fabs, etc. involved. All that takes time and all that is a real risk.

    • semiconductor manufacturing has been a cyclical boom-bust business for pretty much forever.

      And people making predictions about those booms and busts have been wrong pretty much forever.

  • Sorry guys (Score:3)

    by PPH ( 736903 ) on Sunday July 12, 2026 @02:33PM (#66234806)

    Our old PCs are too outdated to utilize these fancy AI services. And we can no longer upgrade.

    • Consider yourself lucky. The slopocalypse is upon those of us with newer machines. I don't recognize chrome half the time i open it these days

      • Firefox doesn't blast me with AI when I open it, just foxes now. I don't mind the foxes.

        They have, thankfully, so far, made all the AI stuff hidden where you can ignore it.

    • Re: (Score:2)

      by AmiMoJo ( 196126 )

      That's the plan. You can't run AI locally, you must pay them to run it in the cloud, on the RAM you can't afford to buy yourself.

  • Really have no idea how this would work or feasible or what not, but...bitcoin miners are on their way out, does this have potential?

    • Precisely no one is mining bitcoin on equipment that could be easily retrofitted to an AI workload. Bitcoin has for nearly a decade now been something for dedicated ASIC miners that are designed to do a single thing quickly, and AI is not that thing.

      At best you may be able to bust out a soldering iron and scavenge the RAM chips.

    • Bitcoin miners began shifting to AI sixteen months ago.

      https://www.scry.llc/2025/02/0... [scry.llc]

      Most people are still unaware that collectively the Bitcoin miners have lost around $5 billion since the last coin halving (April 2024) and are still losing money. Current loss:

      Annual Coin Income: $64k x 165k coins = $10.5 billion
      Annual Energy Cost: 130 terawatts @ $0.105 per kwatt = $13.6 billion
      Annual Net Loss: $3.1 billion

      https://www.scry.llc/2026/02/0... [scry.llc]

      • Re: (Score:2)

        by gweihir ( 88907 )

        What do you expect? It works on the same principle as the lottery, just with far, far more waste and less payout.

  • Some countries due to the need for RAM to be used in critical infrastructure may threaten manufactures with mandatory allocation of RAM away from AI applications and towards server and PC infrastructure. Imagine what would happen if the government had to pay 5X the RAM cost just to get a PC or server loaded up with enough RAM.

    If the manufacturer refused and threatens to pull out of the country. This could be deemed a national security issue, and Compulsory Licensing could come into play if the country has t

    • Re: (Score:2)

      by lxnt ( 98232 )

      who cares about ip. it's the facilites and workforce that can't be scaled.

      • Re:Compulsory Licensing (Score:4, Insightful)

        by hwstar ( 35834 ) on Sunday July 12, 2026 @02:57PM (#66234850)

        No need to increase the workforce, just reallocate what is currently being produced or face compulsory licensing. Many countries have done this for pharmaceuticals, but it isn't just limited to those. Just the mere threat of compulsory licensing should cause the memory companies to start re-allocating more memory to the PC and server sector. They will do anything to avoid the government taking away control of their IP. They would rather reallocate and retain control then be subject to compulsory licensing.

        Nations that have formally utilized compulsory licensing in the past include:

        Canada: Long used compulsory licensing, especially for pharmaceuticals, and streamlined its usage during public health crises like the COVID-19 pandemic.

        United States: Has used or threatened to use compulsory licensing for medical products and government uses.

        Germany & Italy: Have issued compulsory licenses, with Germany utilizing them for patents relating to medical treatments.Israel: Invoked compulsory licenses during health emergencies to secure medications.Middle-Income Countries:India: Issued a famous compulsory license in 2012 for a life-saving cancer drug (Sorafenibtosylate).

        Thailand & Indonesia: Have a history of issuing compulsory licenses to lower the costs of HIV/AIDS and hepatitis treatments.

        Russia: Has used compulsory licensing for critical drugs such as Remdesivir and continues to utilize it as an active legal tool.Brazil: Issued compulsory licenses in the past to combat high prices on essential antiretroviral medications.

    • Re: (Score:2, Insightful)

      by thegarbz ( 1787294 )

      Imagine what would happen if the government had to pay 5X the RAM cost just to get a PC or server loaded up with enough RAM.

      *Commences Imagining*
      Procurement: "The ram costs 5x the amount of the server itself."
      Department head: "Is that the market rate?"
      Procurement: "Yes"
      Department head: "Okay go for it.
      *Ends Imagining*.

      Sorry was there something out of the ordinary that was supposed to happen in your scenario?

      • Re: (Score:2)

        by hwstar ( 35834 )

        More like:

        Is that the market rate?

        Yes.

        Well, we can purchase some for critical needs, but in the near to long term we need to find a way to make do with less RAM as that is something the company can't support over the long term.

    • Except the allocated fab capacity for AI shit is not the same as what you'd need to add dimms of DDR4 to your laptop, so this is not as easy as "just give us the ram"
    • It takes years to set up your own fabs, and you still need the blueprints and the raw materials to produce them, AND the machines. So you can bet your ass that countries which posses these things, will block you from obtaining those. And you probably will be even blackballed from obtaining the rest of the hardware AND software.

  • Hmm sounds legit.. (Score:3)

    by Mass Overkiller ( 1999306 ) on Sunday July 12, 2026 @02:45PM (#66234824)
    CEO of memory company on the eve of their IPO says memory is in short supply and the prices are going to get worse (ie: higher). Yeah thatâ(TM)s not suspicious at all.
    • My exact thoughts!

    • Re: (Score:3, Insightful)

      by thegarbz ( 1787294 )

      CEO of memory company on the eve of their IPO says memory is in short supply and the prices are going to get worse (ie: higher). Yeah thatâ(TM)s not suspicious at all.

      Yeah that sounds suspicious. On the flip side try rephrasing your point:

      CEO of memory company on the even of their IPO says thing that all other CEOs of memory companies have already been saying, things that industry analysts have been saying, things that tech media have been saying, and thing that just make sense given current state of AI investment.

      Doesn't sound remotely suspicious now does it?

  • This all smells of bullshit to me. My hunch is that the memory manufacturers are colluding again in preparation for the bubble to burst. They'll blame of few years of high price colluding on AI one way or the other. When the authorities finally do catch up and find them guilty the fine will be .000001% of the damage they did. Worse, this ass-hole CEO proclaiming this will not see a day behind bars.

    • "My hunch is that the memory manufacturers are colluding again in preparation for the bubble to burst."

      What would a memory manufacturer do if they were *not* colluding, but did anticipate an AI bubble bursting? Exactly the same thing.

  • Since we cannot expect a decrease of demand from AI any time soon - what's the plan to address this demand?

    • There's really only 3 solutions to the problem. Require the fabs to allocate more fab time to creating consumer memory. Build more fabs. The AI bubble pops.

    • "we cannot expect a decrease of demand from AI any time soon"

      Who is this "we"? This comment section has plenty of people talking about an AI bubble.

  • I hope some chinese manufacturers are stepping up, as current chinese DDR5 memory is just as good as from any other manufacturer (bar of course the real fake ones).

  • Decades is assuming we continue the datacenter build out, the chances of datacenter demand destruction is not zero.

  • While a market can remain irrational longer than an individual can remain solvent, a market can also become rational faster than an individual can become liquid.

    Memory manufacturers can have the same suspicions of a bubble as anyone else. Why are people surprised that memory manufacturer would respond the same as anyone else?

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