Silicon Motion's CEO has said that memory (DRAM) and SSD (NAND) shortages would last until 2028 due to the continued demand from AI firms.
Memory & SSD Shortages Are So Bad That They Are Expected To Last Till 2028, And Prices Are Expected To Continue To Climb
We know that memory and SSD shortages are bad, both in the enterprise and consumer segments. DRAM & NAND makers are adding new factories to boost production capabilities, but these aren't expected to become operational within this year.
At the earliest, the first facility expansion and bring-up plans are expected around 2027, which means that volume production can commence by late 2027 or early 2028. Furthermore, the facilities that will come online will only address the current requirements for NAND & DRAM required for AI segments. At current production rates, the DRAM and NAND makers are only able to meet 60-70% of the total demand, and with Gigawatt-scale datacenters coming online in the next few years, this demand is going to skyrocket.
According to Chia-Chang Gou, General Manager of SIMO-US, a major memory controller chip manufacturer, the focus of AI investment is rapidly shifting from training to inference, which is further driving the simultaneous growth of memory and storage demand. With supply constraints, the tight supply and demand situation of DRAM and NAND Flash is expected to be difficult to resolve in the short term. NAND Flash may be in short supply until 2028, and memory prices are expected to continue to rise in the second half of the year.
Economic Daily Korea
Given the extreme pressure on DRAM and NAND makers, Silicon Motion's CEO, Chia-Chang Gou, has said that memory and SSD shortages are expected to last till 2028. Previously, these shortages were expected to last till 2027, but now the timeline is extending for both RAMpocalypse and SSDpocalypse.
Silicon Motion primarily makes NAND controllers for Enterprise and Consumer SSDs. They have a good understanding of where the industry is heading, and have stated that as supply remains tight, AI firms are locking in supply in advance through long-term contracts and prepayments. SK Hynix has recently backed out of accepting investments that could restrict its supply to specific vendors.
Gou said that it takes at least 2-3 years to make a production factory and reach volume production. Even then, the delivery times are usually around 1-1.5 years, highlighting that in the short term, it is difficult to address the supply and demand gap.
These shortages would result in higher prices across the board. Silicon Motion expects memory and SSD prices to rise throughout the second half of this year. These higher prices are forcing several consumer products to be discontinued, and adding pressure on vendors as component prices continue to rise.
Chinese manufacturers were seen as a savior in the beginning, but China's domestic demand has also reached levels that are putting pressure on manufacturers such as CXMT and YMTC. Samsung has also said that they expect memory shortages to be worse in 2027 than in 2026, so yeah, hang on tight, as things are only getting worse in the coming months.
News Source: Economic Daily Korea
About the author: A Software Engineer by training and a PC enthusiast by passion, Hassan Mujtaba serves as Wccftech's Senior Editor for hardware section. With years of experience in the industry, he specializes in deep-dive technical analysis of next-generation CPU and GPU architectures, motherboards, and cooling solutions. His work involves not only breaking news on upcoming technologies but also extensive hands-on reviews and benchmarking.
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