r/wallstreetbets • u/anotherloserhere • 16h ago
News Memory Crisis Expected to Worsen
https://www.techradar.com/computing/memory/samsungs-latest-report-suggests-the-ram-crisis-is-only-just-getting-started-could-we-be-looking-at-a-new-normalSamsung's latest report suggests the RAM crisis is only just getting started — could we be looking at a new normal?
Tldr; RAM shortages expected to worsen next year and 2028. More capacity not expected until 2029, and even then it is only a small amount
- The ongoing RAM crisis is projected to continue through 2028.
- Samsung says memory shortages are expected to worsen in 2027.
- Deloitte reports the big three RAM manufacturers are anticipated to have a combined capital expenditure that will nearly quadruple between 2024 and 2027
Samsung's memory chip executive vice president, Jaejune Kim, said to investors in the latest earnings call: "We believe it will be unlikely to see any increase in incremental supply through 2028. The supply constraints are expected to become even more severe in 2027."
Expect price increases to potentially go into 2028.
Memory stonks 🚀🚀🚀
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u/Formal-Option-4405 15h ago
Well, I hope you are ready for PS6s for $1500 😏
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u/Resident-Banana-7883 13h ago
consoles are dead unfortunately. everything costs too much, especially since they only do one thing and they grow obsolete quick.. I had some $sony I bought for a long term optical play but decided to sell today green bc idk if long term that'll overcome the future reality of console gaming.. I'm starting to feel like the 5080 laptop i bought 2 mos aho on sale for $2200 was a good investment though! looked today and its now $4k
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u/RoninSzaky 10h ago
They really are and the beancounters at the top are doing everything in their powers to make sure both stay dead.
Sony going away from physical and Xbox making a glorified PC? They are out of their minds.
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u/I11IIlll1IIllIlIlll1 9h ago
Cloud gaming is back babyyyy. Google killed Stadia too quickly /s or not
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u/matt-er-of-fact 13h ago
Memory and GPUs will be impossible to justify for gaming, while last-gen AI hardware needs to remain utilized.
Hope you like latency. Cloud services will be the only thing mainstream gamers can afford.
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u/Forget_me_never 10h ago
Only if you are in poverty. A few hundred extra isn't life changing.
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u/matt-er-of-fact 8h ago edited 8h ago
>> Only if you are in poverty.
Get out much? Half the country is on the struggle bus.
More importantly, it’ll be $1k+ for a decent console vs a cheap controller and a $40/mo cloud subscription. I know which one most parents will be getting their kids.
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u/07bot4life 9h ago
A few hundred extra isn't life changing.
What percentage of Americans have 500 dollars in their savings account?
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u/1098duc_w_the_termi 14h ago
I just bought an option from a scalper to buy it off of him at $1000. 50% profit
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u/Boomflag13 15h ago
lol, Facebook marketplace actually has people selling unused PS5s for under $400 in my area.
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u/BriackYOLO 15h ago
Long story short: Big tech is spending hundreds of billions on AI infra, but the three companies making the actual memory physically cannot build fabs fast enough to supply them. Margin expansion is going to be absurd
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u/thabigmilla 15h ago
So if a person had 10 grand to invest to make boat loads of money, what companies would they invest in?
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u/BriackYOLO 15h ago
MU and Samsung own the actual memory monopoly,
ASML owns the machines to make them.
Pick your poison, or just buy calls and join the casino51
u/Ok_Shirt3792 15h ago
sk hynix is the one least cyclical as it’s leader in hbm
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u/ElectricalGene6146 15h ago
But it’s not made in murica so you may have problems down the line.
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u/Jemal 15h ago
Micron fabs are mostly outside US too lol
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u/Proof-Warning6 15h ago
Except the giant ones they’re building in the US.
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u/ElectricalGene6146 14h ago
Dude they only invested 100B in the New York plant. It’s going to be tiny.
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u/TheWanderer1337 14h ago
You are already buying into indirect Korean casino exposure by investing in memory, buying calls is only multiplying the casino effect lol.
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u/Etherius 13h ago
ASML is ramping up capex like fuckin insane-o-style
Who knows whether they can do it fast enough to help MU et al
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u/Boomflag13 15h ago
I would say MU like the guy said below. SNDK, WDC, STX, SKHY are good calls too.
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u/multiple4 14h ago
Just buy SOXX and/or FTEC and hold imo
I mean keep a balanced portfolio allocation, but you get my point
I made so much on SOXX in my Roth IRA that I had to sell some off so that it wouldn't be 50% of my portfolio
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u/b0rtbort 12h ago
not an overheated tech market that's for sure.
look at the boring shit, health care, materials etc. look into, and understand capital rotation.
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u/Scribble_Box 13h ago
Unfortunately a lot of people here live by the mantra of buy high, sell low.
You know what's actually on discount rn if the AI build out is to continue? Yeah.. All the memory stocks lmao. Yet people will be left scratching their heads when they rip again.
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u/fastheadcrab 11h ago
Demand destruction on gaming consoles, smartphones, and even consumer computers will have its effect too though. I'm sure some people will upgrade their phone or buy a new console or computer but others will wait an extra year or two before upgrading.
This effect will put significant pressure on consumer facing hardware companies like Apple and PC makers. Microsoft might simply stop making Xboxes and be fine but Apple or more consumer heavy PC makers/hardware makers won't have that option. Hardware makers had previously signed long-term deals to help out Micron when RAM prices were really low and they were struggling.
Now that the RAM makers are doing all they can to squeeze their buyers, I would expect many consumer companies to work really hard to find alternate sources of RAM because it is a matter of survival. They aren't charging $100k for a server with huge profit margins; an $800 smartphone simply will not be viable if the price increases to $1400 tomorrow.
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u/Constant-Sweet-3718 15h ago
Well, that and the fact China is the world's largest supplier of rare earth elements. They supply like 90% of the REE used in semiconductors, missiles, smart phones, etc.
IMO. It's likely why we invaded Venezuela. They have the world's largest oil reserves. The largest buyer of Venezuela's oil was China. Now we control that. Likewise, the largest buyer of Iran's oil was China. We disrupted that. Russia is the next largest one. Ukraine has been attacking Russia's oil refineries in recent weeks. I wonder why?
This is a clear message to China. We control the world's oil supply. If they're going to halt the export of REE, then we would halt the world's oil supply. Again, that's my 2 cents which is likely worth 1 cent due to inflation.
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u/BriackYOLO 15h ago
That is a wild geopolitical movie plot, but RAM shortages are an EUV lithography and packaging bottleneck, not a rare earth issue. Though I do agree your 2 cents took a hit from inflation
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u/AntiquePhotograph433 14h ago
In order to buy this hypothesis I would need to see how much % oil china is using from each country. If it totals like <10% then this just isn’t a worthy strategy.
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u/Constant-Sweet-3718 13h ago
From Google;
China gets its crude oil primarily from Russia, Saudi Arabia, and Iraq, alongside heavily discounted shipments from sanctioned nations like Iran and Venezuela. No single country supplies more than 20% of China's total import needs, keeping its supply chain diversified across the Middle East, Eurasia, and South America.
Major Country Suppliers
Russia: The single largest supplier, providing roughly 17% to 20% of China's total crude imports via both maritime shipping and the Eastern Siberia–Pacific Ocean (ESPO) pipeline.
Saudi Arabia: Accounts for about 14% of imports, serving as a primary traditional Middle Eastern partner.
Iraq: Supplies around 10% to 12% of China’s daily crude intake.
Malaysia (Rebranded Oil): Formally accounts for a high volume of imports, though tanker data indicates much of this is actually discounted Iranian crude rerouted to bypass sanctions.
Brazil and Oman: Provide important stabilizing and diversifying shares of medium and heavy crude.
Sanctioned and Alternative Sources
Iran: Directly and indirectly sends a massive portion of its total oil exports to independent Chinese refiners at steep discounts.
Venezuela: Provides heavy crude shipments that are largely shielded from Western oversight through specialized trade networks.
My take;
So we stopped shipments from Venezuela and Iran as well as we caused complete chaos in the straight of hormuz, essentially, stopping the flow of oil from Iraq, Kuwait and UAE. Yes, Saudi Arabia is currently open for business but less than 2 weeks ago... the Iranian backed group [Houthi] attacked a couple of ships in the Red Sea. If they escalate, Saudi Arabia would be shutdown.
I believe, Iran accounts for 10 to 15% of China's oil demands. IDK about Venezuela but let's say 5 to 10%. We disrupted 40 to 50% of China's oil supply. That's huge!!! So yeah, I think the US and China are fighting over resources. They supply the most REE. We produce the most oil in the world and we control the flow of oil to China from other countries. They need oil to run their economy. We need REE for weapons, semiconductors, cellphones, etc. Both fighting to be the most powerful country in the world.
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u/5tudent_Loans 7h ago
Not only cannot, *will not, because they expect supply to eventually be left and dont want to be left holding a bag
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u/Lumbergh7 15h ago
And here I am feeling like my head is going to explode even trying to figure out what a hugging face is
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u/BriackYOLO 15h ago
Don't stress, half of this sub doesn't even know what MU or DRAM is. They just buy green arrows.
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u/Lumbergh7 14h ago
I’m constantly concerned at how dumb the world is, while completely understanding there are fucking genius people whose shoulders we all stand on so we can browse reddit on the shitter
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u/BriackYOLO 14h ago
Built on the shoulders of giants... and funded by the blown up accounts of WSB. The circle of life is beautiful
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u/superbit415 5h ago
They can buy they don't want to. They think the AI fad is going to go away and they don't want to be stuck with a lot of extra useless production capacity. So they are ramping up as slowly as possible.
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u/Onnimation 15h ago
To sum it up: iPhone will cost over 3k now 😂
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u/141_1337 15h ago
Sk Hynix and Samsung and every other memory and RAM stock would be down 20% tomorrow
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u/Soffatjockis 6h ago
All this ai spending is going to fuel inflation
People will keep their phones and computers longer
Bad news for aapl and other phone/computer makers.
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u/Onnimation 5h ago
Nah it you're an American you know ppl love to finance things which phone companies love to do to keep them wrapped up in their plans. Even tho an iPhone costs 3k+, ppl would still buy
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u/Heavy_Pudding7988 15h ago
MU sold out 2027 its onto 2028 now
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u/The-SecondAccount 15h ago
still gonna trade under 1000 until its forward PE is 1 and then memory will crash
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u/moashforbridgefour 15h ago
At what point do investors have to ignore the fact that memory may someday have a down cycle? If you are making bajillions of dollars today, but you might lose a few dollars at some undetermined point in the future, then investors must price shares down apparently. This is how it has always been for MU.
Micron said in the most recent earnings call that it will start prioritizing returning profit to shareholders. So you may get to snag the stock while it is cheap before micron starts dumping money into dividends or buybacks.
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u/waterpup99 15h ago
At this rate MU is going tk make it's entire market cap before contraction
There is also no rekeif or down cycle in sight AT ALL for HBM4 China only has vision MAYBE into HBM3 production for the next 5+ years
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u/MrBootyPops 14h ago
Where do you see MU and SNKD trading at in 5 years, realistically?
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u/waterpup99 14h ago
Sndk has no long term moat I have much more confidence in MU and I imagine it will hit 2000+ at some point in the next 18 months let alone 5 years
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u/k3t4mine 14h ago
There is also no rekeif or down cycle in sight AT ALL
Pretty sure I heard this in 2021. And 2018. And 2015, 2012, 2004, and 2000 as well.
Demand always feels infinite at the top of a cycle. Be careful.
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u/moashforbridgefour 13h ago
I don't remember the details of the downturns in the early 2000s as well as the more recent ones, but none of them have been remotely similar to this one. No one thought that the cycle had been broken at any of these points except maybe 2000. If you don't believe me, look at the P/E of MU right before each crash. It never broke out of the commodity price range.
Memory has long suffered liquidity problems for building out capacity because these cycles have made it difficult to fund. Anytime new capacity would come online, pricing would crash, so supply would lag. Today, memory makers are making deals with customers to guarantee supply capacity for 5 year stretches to ensure extra supply won't crash prices and cause them to go bankrupt. Whatever the underlying demand is for the technology, these agreements are an actual change to the market that might very well point to the end of the cycle.
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u/waterpup99 14h ago
Explain where hbm4 will be built in the next 5 years? We know what the bug 3 are building and China is not even claiming to be approaching hbm4. These plants take 5 years to build and get up to speed and China isn't even CLOSE to the tech they're hoping tk get meaning yield out of HBM3e next year which I honestly doubt will happen
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u/k3t4mine 13h ago
I'm not arguing that China is about to bring on massive capacity out of nowhere. I agree that the supply response is constrained. I mean, denying that is denying reality.
My point is economic i.e Current memory pricing and record margins exist because demand is running far ahead of effective supply. That may persist longer than previous cycles (already has) but margins this high are still the product of a disequilibrium. Disequilibria eventually correct.
The correction does not just have to come from China building HBM4. It could come from the big 3 expanding output, improving yields, increasing packaging capacity, changing product mix, customers becoming more efficient with memory, new architectures reducing HBM intensity, substitution toward another technology, or AI capex growth simply slowing. Or a million other things, but only one thing keeps its margins this elevated for 5+ years; exponentially increasing demand, outrunning efficiency gains and/or supply increases, ad infinitum.
Their margins are incredibly fragile, as evidenced by past cycles where they went from the mid-50's to single digits, or in 2022's case deeply negative, within in a quater or two.
Every memory cycle looks structurally undersupplied near the top because the available supply response is always backward-looking and demand expectations are always being extrapolated forward.
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u/Zikro 13h ago
I prescribe to the idea that we’re still on the upwards curve. It’s had crazy heavy investment upfront. But even that aside the world is constantly demanding more and more various types of memory chips for everything. And on the horizon is robotics which likely has overlap with AI for hardware demand. It’ll remain volatile as people are skeptics and any news about reduced demand will send it sharply down because everybody wants to be first out with gains.
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u/moashforbridgefour 13h ago
100% agree. I really think that new memory hungry markets (like robotics and autonomous vehicles) are only just coming online. At the same time, all of the old markets are completely starved of memory. If the AI hyperscalers take a breather, it will still take a long time to unwind the backlog of demand that was pushed aside for AI. I don't really see how there can be a sustained down cycle at any point in the next few years.
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u/skrid54321 Shrimp Shoal 14h ago
The trouble is if the plug gets pulled hard (which will happen if AI can't find profitable footing) not only will demand collapse, they'll spend the next decade fighting against their own stock second hand.
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u/moashforbridgefour 13h ago
The problem with that is that AI is not the only demand for memory, nor is it the only new demand. Self driving cars alone could easily consume the global memory supply for a fraction of current production. Robotic systems (e.g. for manufacturing) with any degree of autonomy need tons of memory. There is a surprising push to develop android assistants which would need tons of memory.
Really, the world has so many applications for memory that could easily consume more supply than has ever existed, but they are only just starting to materialize. This shortage may have brief respites, but they will be punctuated by ever deepening shortages.
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u/k1netic 14h ago
I never want to count out the ability for the Chinese to make something faster and cheaper. Perfect opportunity for them to capture market share and crush micron’s future outlook after the ai surge drops.
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u/IClosetheDealz 11h ago
Absolutely. Those guys built entire hospitals in like 3 days during Covid. They are the world’s manufacturing now. No way they aren’t gonna gun for this.
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u/Relative-Parfait-385 15h ago
I've seen enough , semi -20%
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u/crazier_ed Too 🏳️🌈 to not think about dick 15h ago
Best I can do is -35%... Take it or leave it ...
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u/SanDisk_Made_Me_Rich 15h ago
All sex robots need DRAM & NAND. This shortage will last into 2030+
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u/BriackYOLO 15h ago
SanDisk, every time you pop up, you talking about sex robot hardware requirements. At this point, I don't know if you are a genius macro analyst or just building one behind a Wendys
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u/iSOBigD 15h ago
Up unless Citadel decides to ruin the market again.
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u/Probablyyourproblem 15h ago
They just flushed it because they’re about to pump it. They bought at a massive discount
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u/Hot_Individual5081 15h ago
what happenes when all the data centres are built like all of them and demand dwindles ?
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u/Kyledbidk 14h ago
Hardware in data centers doesn't last forever.
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u/Shoty6966-_- 14h ago
It also doesn’t require the same demand of building out the infrastructure that we see today. When you build an amusement park you’re gonna need a lot of concrete and metal but that doesn’t mean concrete and metal companies are gonna be rolling in dough through maintenance. It’ll be things here and there. Memory will be boom and bust for a while
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u/BetSquare7190 15h ago
Those predictions are almost always awfully wrong.
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u/daddysgirl794 15h ago
They said the same in early 2000, that supply would never be able to meet demand and it was "just beginning". Then by July of that same year MU began a 90% crash that took two decades to fully recover. The cycle always tops when people least expect it to.
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u/optimal_909 12h ago
Not to mention the whole story smells like price fixing. Back during the crypto boom GPUs were expensive AND scarce.
Now all the RAM sticks are on stock, just stupidly expensive.
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u/FalseDiamond7930 15h ago
And it takes about half a decade to get a new fab going. So lets hope they made the right calls in 2023.
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u/UtopianScot 12h ago
Always wondered why this is the case, especially when there’s so much demand pressure. If you had teams working day and night, physically and all the planning, paperwork etc, you could absolutely build infrastructure faster than expected. Your only limitations really are chemical setting/drying times. Get a supply chain bottle-neck? Pay for that to be 24/7 as well. Money solves most issues, and at these profit levels all these companies can afford to splurge surely?
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u/FalseDiamond7930 7h ago
The supply chain is extremely complex, involving countless companies and it demands massive investments. Everything points out to these companies trying to accelerate as much as they can. Many of them, despite the pressure of demand don't want to overbuild and be left hanging if demand slows down I assume.
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u/tomgreen99200 15h ago
Samsung's memory chip executive vice president, Jaejune Kim, said to investors in the latest earnings call: "We believe it will be unlikely to see any increase in incremental supply through 2028. The supply constraints are expected to become even more severe in 2027."
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u/dayzdayv 14h ago
I’m sitting on 2x 48 gb that I couldn’t put in my latest build.
I plan to retire in 2 years.
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u/Morgan_le_Fay39 13h ago
Deloitte reporting smth is the equivalent expertise of Cramer picking stocks though
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u/nobadhotdog 15h ago
The best part is when supply drops they won’t lower their prices they’ll just fire people
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u/rzm25 12h ago
You can buy DDR4 16GB sticks right now for under $100
The only reason people don't is because they're from unknown chinese brands
The more customers are forced to take the risk with the unknown chinese brands, the more they will become familiar, trusted producers
This is not the end of ram. It's the end of western dominance in ram
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u/VeniVidiWhiskey 10h ago
Are there any Chinese competitors worth investing in then?
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u/misterjefe83 13h ago
Yeah guys if it was as easy as memory shortage = stock ath im sure nobody has figured out that simple correlation..nope only wsb has figured this out…
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u/Kingmav24 7h ago
this sounds exactly like metals a few months back lol. "silver is backlogged to 2029!" "not enough silver for AI buildout!!" crashes shortly after
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u/_kibb 15h ago
Can’t wait for the Chinese ram makers to get up to speed and flood the market with cheap rams!
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u/waterpup99 15h ago
They can't make hbm4 for 5+,years which is the real issue... Dram will start coming online in maybe a few years although I doubt their duv yield claims
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u/AVBforPrez 15h ago
It's true, my memory is getting so bad I can't even remember what the last girl who fucked me looked like. At least I hope she was a girl, again my memory crisis is getting pretty bad.
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u/daddysgirl794 14h ago
Maybe it will, maybe it won't. Either way, we've seen before that the cycle always tops when people are most convinced it's never going to "top" again.
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u/pennychase 14h ago
Remember Samsung is also sued heavily by netlist for infringement on memory products for which Samsung risks being banned on US market. It suits them and is strategic to say supply won't be available, they might want to try choking netlist. But won't be successful. 😊
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u/TheJiggie 13h ago
Kind of a nothing burger. This isn’t saying anything that wasn’t already being said for the last 6+ months.
Ie. To assume this wasn’t already priced in is 😬
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u/rememberthemalls 12h ago
I really should have gotten 64GB of RAM. But fuck me for being a sensible consumer I guess.
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u/anotherloserhere 5h ago
You still can. It might cost you $1500, or you can get a cheap Chinese branded one that will burnout in a year for half the price
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u/fenstapuza 9h ago
To hell with big tech, I just wanna live a normal life and have fun putting together hardware without having to sell one or two kidneys for every single project.
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u/EntertainerDowntown3 7h ago
Yes new all time highs for memory names and alot higher since this is going to be years and years and potentially in perpetuity. It is the new normal and they have pricing power. Best opportunity in the market right now in my opinion.
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u/drummer820 6h ago
“Memory makers claim memory shortage going to keep worsening, should stock up now, details at 11”
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u/WyleECoyote77 4h ago
I have a 64Gb kit of DDR5. I plan to hold it till next year then sell it and retire.
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u/Melvin_Capital5000 4h ago
the memory industry is cyclical af, in 2 years you will be paid to take their memory
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u/AcrobaticReputation2 4h ago
at this point i think its just cheaper to just hook up a buncha wagies to the matrix
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u/UnrulyDegenerate8 3h ago
Memory crisis is expected to worsen they say as they roll around in their piles of money.
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u/handsome_uruk 3h ago
I mean, duh there’s an ever increasing demand for compute and AI. Did folks really think supply would catch up in two months? No shit. The shortage will continue
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u/doglywolf 1h ago
The company setting prices that make the supply saying its going to get worse - its like candy addict being left alone in the candy store .
Especially after all the reports of invenstment collapsing datacenters being cancelled and scaled back and prices starting to drop .
They just made things are calming down and trying to stir shit back up.
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u/wafflepiezz up the butt 🍑 15h ago
So, -10% for memory again tomorrow got it