The memory semiconductor market is witnessing a significant turnaround as demand for IT devices, such as smartphones and PCs, revives. This resurgence is driving up prices for key components like D-RAM and NAND flash, marking a stark contrast to the oversupply and price drops experienced last year. The shift is largely attributed to the global AI boom and improving economic conditions, which have reignited consumer interest in high-performance semiconductors.
Last year, the semiconductor industry faced a dichotomy. While high-performance semiconductors for AI servers, such as high-bandwidth memory (HBM), were in high demand, general-purpose memory used in PCs and smartphones suffered from oversupply due to an economic recession and a slowdown in consumer spending. This led to a nearly 30% drop in NAND flash prices in October and November. However, the market began to show signs of recovery at the start of this year, with fixed trading prices for 128Gb multi-level cell (MLC) NAND flash rising to $2.18 in January and $2.29 in February.
According to the Taiwanese market research firm DRAMeXchange on March 13, the average spot trading price of the general-purpose D-RAM DDR4 8Gb product recorded $1.466. This marks a continuous increase for five consecutive days since March 7. Similarly, the spot price for the 16Gb DDR5 product increased by over 6% to $5.068 compared to last month on March 12. This upward trend is expected to continue, with SanDisk planning to raise product prices by more than 10% on April 1, driven by expectations that demand will soon exceed supply.
Micron Technology has expressed optimism about the market’s trajectory, stating, “Inventory levels for both PCs and smartphones are improving and are expected to reach a healthy place by spring.” This sentiment is echoed by Kwak No-jung, president of SK Hynix, who noted, “The industry has been reducing production due to excess NAND supply, and I think it will improve by the end of this year.” He added, “The entire industry is working to stabilize the NAND market, so it will get better soon.”
The anticipated recovery is further supported by predictions from the U.S. market research firm Gartner, which forecasts a 165.5% surge in the market size of AI PCs this year, from 43.02 million units last year to 114.22 million units. This growth is expected to bolster demand for memory semiconductors, prompting major players like Samsung Electronics and SK Hynix to consider expanding production of general-purpose products if the price rally continues.
Lee Jong-wook, a researcher at Samsung Securities, analyzed the situation, stating, “There is a possibility of a rise in low-power D-RAM (LPDDR5) following DDR5 in the second quarter,” and “The pessimism about general-purpose products is expected to be resolved in a more optimistic direction throughout the second quarter.”
