I had to buy ram recently T.T
Ram supply shock and demand increase skyrocket prices
Demand Increase: Companies adopting ai at an alarming rate. Every ai workload requires more ram, every model upgrade requires more ram per chip. • Macro Trend: Hyperscalers keep expanding capex. Demand floor keeps rising with no ceiling in sight.
Supply Decrease: New fabs take 2-3 years minimum to build, cleanrooms are physically rate limited. The 3 suppliers are signaling discipline over volume, opposite of past cycles where they overbuilt and crashed prices themselves. • Regulatory Slowdown: Government buildout of US based ram factories delayed from 2028 to 2030.
Supply Decrease: Because the contracts bought 70% of the supply, only 30% will hit the market, causing prices to increase. • Contract: Hyperscalers buy ram faster than factories can produce. Companies like Microsoft, Google, Meta, and Amazon signed long term contracts with the 3 ram producers (Samsung, SK Hynix, Micron) to buy 70% of the supply before its even produced.
1 propagations
The DRAM market is under pressure from long-term contracts with hyperscalers and limited production capacity, driving supply constraints. Upside scenarios include additional large-scale RAM contracts and AI demand surges, while downside risks involve economic recessions curtailing tech spending and rapid construction of new semiconductor plants easing supply pressures. The net expected value leans positive, supported by strong news evidence corroborating the thesis.
The thesis relies on a tight supply of DRAM due to long-term contracts with hyperscalers and limited new production capacity.
The thesis focuses on the supply constraints in the DRAM market due to long-term contracts with hyperscalers and limited production capacity, coupled with increasing demand from AI applications.
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