Executive Summary
DRAM spot prices have surged dramatically since Q2 2025, creating a structural supply shortage that Ray Wang of Semi Analysis projects will last through 2027. Memory makers face a critical allocation decision: high-bandwidth memory (HBM) for AI applications requires 3x more wafer capacity than commodity DRAM but generates superior margins. Wang notes that on the same wafer basis, producers can generate three bits of commodity DRAM versus only one bit of HBM, creating an unprecedented supply constraint. Major consumer electronics companies including Apple and Nintendo are experiencing production delays, with MediaTek cutting mobile chip outlook by 10-15% for 2026. The shortage stems from conservative 2024 CAPEX decisions following COVID demand volatility, while AI inference demand has exploded 800 million ChatGPT users consuming exponentially more tokens per session. Clean room constraints limit immediate capacity expansion, forcing memory makers to rely on node migration from 1C to 1B processes. Wang emphasizes this differs from historical cycles because HBM production cannibalizes commodity DRAM capacity, creating simultaneous shortages across both segments. Micron Technology trades at $411.66, up 307% year-over-year, with bullish sentiment despite recent insider selling of $32.5 million. The company benefits from being a primary HBM supplier while maintaining commodity DRAM exposure, positioning it to capture pricing power across both segments during this extended super cycle.
Key Insights
what Ray Wang said“To give you a sense, right? You know, on the same wafer basis, you can produce three more bits if you do commodity DRAM, but you can only produce one bit of HBM”
what Ray Wang said“Because we really see in the sort of super cycle that there's a new demand driver coming online. It's not only constrained the demand, this thing is also constrained as a plot”
what Ray Wang said“So clean room constraint is basically you have limited space that you can put all the increments and start manufacturing chips in the fat”
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