Driven by rising memory chip prices fueled by rising artificial intelligence (AI) investment, the global memory semiconductor market is projected to reach nearly KRW 350 trillion (approximately USD 269.23 billion) in the second quarter of this year. Prices of both DRAM and NAND Flash have climbed more than 50%, which is expected to push Samsung Electronics and SK Hynix to record all-time high profits. Nevertheless, observations indicate that growth will moderate in the second half of next year amid expanded long-term agreements (LTAs) and pricing headwinds.
Per the Memory Tracker Report released by market research firm Counterpoint Research, the global memory market size is estimated to reach around KRW 350 trillion in Q2 this year, representing a quarter-on-quarter jump of over 60% and a 380% year-on-year surge.
The market expansion is primarily driven by skyrocketing memory prices. Counterpoint Research’s analysis shows that both DRAM and NAND Flash prices rose more than 50% quarter-on-quarter in Q2. Driven by sustained investment in AI data centers and tight HBM supply, prices for general-purpose memory have rallied in tandem, drastically lifting overall market value.
Earnings of major memory manufacturers are set to mirror this market upturn. Micron Technology recently released its financial results, reporting fiscal Q3 revenue (March–May) of USD 41.46 billion (equivalent to roughly KRW 64 trillion, or USD 49.23 billion), up 74% quarter-on-quarter and 346% year-on-year, with an operating margin nearing 85%.
Samsung Electronics and SK Hynix are scheduled to release earnings earlier than previously anticipated, and their financial performance is expected to far outpace market consensus. Counterpoint Research forecasts that Samsung Electronics’ memory business revenue will top KRW 110 trillion (approximately USD 84.62 billion) for the first time, while SK Hynix will maintain robust growth backed by its product competitiveness centered on HBM.
That said, the report notes that discrepancies may exist across manufacturers’ financial results due to differing accounting treatments, such as the timing of LTA signings and performance bonus provisions. Even so, the report’s analysis confirms that AI-driven memory demand and price hikes will remain intact in the short term.
Counterpoint Research, however, predicts the current rapid growth momentum cannot be sustained over the long run. Higher memory prices inflate manufacturing costs and end-product retail prices, which in turn curb demand to a certain extent. Meanwhile, the price-locking effect brought by expanded long-term supply contracts is starting to take hold.
“Elevated memory prices push up production costs and weigh on demand for end products,” Counterpoint Research stated. It added, “Coupled with the price stabilization effect from expanded LTAs, the growth rate of the memory market is likely to gradually slow starting in the second half of next year.”
(Reprinted from https://news.eccn.com/）