Memory prices are hard to lower! Micron: DRAM shortages will last until 2027, and this time there's a new bottleneck

Why does AI and HBM technology upgrade significantly squeeze DRAM capacity?

TechFast News, April 3 — According to a Morgan Stanley tracking report, Micron Technology Chairman and CEO Sanjay Mehrotra stated at an investor meeting that the shortage of DRAM supply will continue until 2027, with new capacity not expected to ship until the end of 2027 at the earliest, and it is anticipated that market supply will only be materially affected by 2028.

There are two main reasons for this situation. On one hand, Micron is actively expanding its DRAM capacity, but building new wafer factories takes a long time from construction to mass production.

On the other hand, the limited capacity and long delivery cycles of extreme ultraviolet (EUV) lithography equipment needed for advanced processes, along with supply bottlenecks in semiconductor equipment, further slow down the expansion pace.

HBM is a key variable exacerbating supply and demand imbalance. Micron has already achieved its goal of reaching parity in HBM bit market share with its overall DRAM market share by the third quarter of 2025.

However, the issue is that when transitioning to HBM4/5, the capacity consumption ratio could be as high as 4:1 — meaning producing the same capacity of HBM requires four times the wafer capacity of traditional DRAM, which significantly encroaches on general DRAM capacity.

To address this structural change, Micron recently launched a “Strategic Customer Agreement” (SCA), and has already signed a five-year long-term contract to ensure appropriate capital returns on capital expenditures.

Management emphasizes that the development of AI and data centers has made memory a strategically important asset, and this long-term cooperation model demonstrates operational resilience different from previous cycles.