Samsung DRAM Prices Double Amid Massive AI Demand
Samsung has confirmed that DRAM prices for the first quarter of this year have shot up more than doubling compared to last quarter. Back in January they were talking about a 70% jump but because AI is growing so fast they had to adjust prices again in February. Big customers around the world are already paying these higher prices meaning memory costs twice as much as they did at the end of last year.
AI is the reason prices are all over the place. Samsung SK Hynix and Micron are mostly making High Bandwidth Memory (HBM) for AI chips so there is not enough regular DRAM to go around. This is causing issues for
- Server Markets Data centers need more memory to expand their AI services and they are all fighting for what is available
- Consumer Electronics PCs and smartphones with AI need more memory which makes the shortage even worse
- Negotiations Instead of yearly contracts they are now negotiating prices every quarter or even every month because things are changing so quickly
Samsung is not the only one raising prices. SK Hynix and Micron are supposedly charging about the same nearly doubling their prices. Big tech companies are buying up as much as they can and many overseas companies are visiting factories in Korea to try to reserve supplies before prices go up even more.
Recent financial numbers from major AI chip companies suggest that this demand is real and not just a bubble. Memory makers have a lot of power in price talks because there is just not enough supply to meet everyone is needs.
Experts think memory costs will keep going up in the second quarter. The increase rate might slow down but prices will likely stay high. Gartner predicts that DRAM and SSD prices will be up 130% compared to last year. Here is what you need to know
- NAND Prices NAND flash prices also went up a lot earlier this quarter showing that storage costs are generally increasing
- Supply Problems Production will likely focus on AI components which make more money for the time to come
- PC and Mobile Prices Because DRAM costs have doubled we will probably see higher prices for computers and phones soon
Industry insiders say that while the first quarter saw a huge rise memory is so important for AI that prices will almost certainly increase in the second quarter even if not as dramatically.
