"Prices of Some DRAM Models Surge Nearly 50% in a Month!" AI Boom and Original Manufacturers' Control Catalyze New DRAM Market Trends

Since entering Q2 2025, the DRAM market has seen continuous price increases, with some segments experiencing tight supply. "Some models have increased by nearly 50% in a month!" a senior executive from a domestic memory producer revealed. Recently, media reports have also stated that Samsung raised the price of DDR4 by 20% and DDR5 by approximately 5% at the beginning of this month.

Several industry chain interviewees stated to Caixin reporters in recent days that this round of market fluctuations primarily stems from strategic capacity adjustments by mainstream original manufacturers such as Samsung and SK Hynix, following the incremental demand for HBM and server DRAM brought about by AI.

"Recently, original manufacturers have successively issued DDR4 EOL (End of Life) notifications. Considering the long-tail demand for D4 products from terminals such as servers and PCs, downstream companies have urgently built up DDR4 inventory, leading to tight supply of DDR4 products in the near term," Yang Yiting, an analyst from CFM Flash Market, told reporters.

Under these circumstances, both original memory manufacturers and module manufacturers with sufficient inventory are expected to benefit. More notably, with the strategic capacity adjustments by international manufacturers and changes in the supply chain environment, domestic memory producers are also embracing structural opportunities.

DRAM Price Surge: AI "Fever" and Original Manufacturers' "Control"

At the beginning of 2025, the trend of tightening DRAM market supply gradually emerged.

Liu Ming, a senior executive from a memory module factory in Shenzhen, provided a vivid market observation to Caixin reporters during a recent market exchange: "DRAM prices have surged sharply recently, especially for some DDR4 models, with a nearly 50% increase in a month. If you ask me about the price today at 4 yuan and think it's expensive, so you wait and see, it might be 4.5 yuan in a few days."

She further explained that due to the capacity tilt of the three major original manufacturers—Samsung, Hynix, and Micron—towards high-performance memory, the inventory levels of niche products have decreased. Prices for niche DRAM products, represented by DDR4 and LPDDR4, have rebounded since the end of March.

"It is expected that the contract prices of PC DRAM and Mobile DRAM in Q2 2025 will increase by 3%-8% and 0%-5%, respectively. This is mainly due to brand manufacturers actively adjusting production to avoid cost pressures from potential policy adjustments, driving up DRAM procurement demand. Meanwhile, Samsung and SK Hynix are in a process transition period, with capacity prioritized for Server DRAM and HBM production, limiting the bit output of PC DRAM and Mobile DRAM," Xu Jiayuan, an analyst from TrendForce, told Caixin reporters.

The spot market has responded more swiftly. According to data from market research firm DRAMeXchange, the fixed transaction price for general-purpose DRAM DDR4 8Gb (gigabyte) products used in personal computers is $1.65, with a 22.22% increase in April. The fixed transaction price for 128Gb MLC NAND flash memory used in memory cards and USBs is $2.79, with an 11.06% increase in April.

It can be seen that the core driving force behind this round of price hikes lies in the revolutionary impact of AI on memory demand. Yole Group predicts in its recent report that the revenue of the HBM market, primarily used for AI, will grow from $17 billion in 2024 to $98 billion in 2030, with a compound annual growth rate (CAGR) as high as 33%.

SK Hynix expects that by 2025, its HBM sales will account for over 50% of its total memory sales. The company's HBM capacity, along with that of Micron Technology, has been fully allocated for 2025. Micron Technology even achieved HBM revenue exceeding $1 billion in the second quarter of its fiscal year ending February 27, 2025, with its data center DRAM revenue also tripling YoY. Leveraging its high bandwidth and low latency characteristics, HBM has become a standard component for AI servers and high-performance computing. For example, NVIDIA's B200 and H200 series GPUs both require HBM.

This robust demand for HBM is significantly squeezing the overall capacity of DRAM and driving up its market value. Against this backdrop, the extent to which different segments of the industry chain benefit shows significant differentiation. Both Xu Jiayuan and Yang Yiting emphasized to Caixin reporters that DRAM original equipment manufacturers (OEMs) are undoubtedly the biggest beneficiaries of this round of price hikes.

Financial data also corroborates this point. SK Hynix achieved an operating profit of 7.44 trillion won in the first quarter of 2025, with an operating profit margin as high as 42%. According to Counterpoint Research, its HBM market share in the quarter reached as high as 70%, surpassing Samsung for the first time to become the leader in the DRAM market.

Micron Technology also achieved a Non-GAAP gross margin of 37.9% in the second quarter of its fiscal year 2025, with strong HBM revenue. Samsung Electronics' DS (Device Solutions) division also achieved an operating profit of 1.1 trillion won in the first quarter of 2025.

In contrast, module producers are generally facing significant operational pressures. Xu Jiayuan pointed out that due to poor transmission of end-use demand, the increase in module retail prices often fails to fully cover the rise in wafer procurement costs. Yang Yiting believes that whether producers can be profitable after the price hikes largely depends on their ability to digest previously purchased low-cost inventories and control costs.

Caixin reporters noted that Biwin Storage (688525.SH), a leading A-share memory module producer, disclosed a net loss of 197 million yuan in its first-quarter 2025 performance report. The company explained that the main reasons included the decline in memory chip prices (referring to some non-popular models or products with higher early procurement costs), an increase in inventory impairment provisions, and lower-than-expected actual delivery volumes of AI end-use product modules. Jiangbo Long (301308.SZ) also reported a net loss attributable to shareholders of publicly listed firms of 152 million yuan in the same period, mentioning in its financial report that downstream clients' inventory digestion led to a decline in the company's gross profit margin.

The "Engine" of HBM Continues to Roar: Traditional Demand and Localisation Add Variables

Looking ahead to the second half of 2025 and beyond, the memory market presents both opportunities and uncertainties.

Xu Jiayuan predicts that, against the backdrop of continued constraints on original manufacturers' bit output, DRAM contract prices in 3Q25 are expected to continue their upward trend. However, he also cautions that if cost pressures resulting from upstream policy adjustments significantly affect end-user consumption willingness, there is a possibility that DRAM price increases may fall short of expectations.

Yang Yiting, on the other hand, assesses that the overall supply situation for memory this year is relatively healthy. With the peak shipping season arriving in the second half of the year, overall market transactions are expected to become more active. However, "volatile external situations" and "actual changes in demand" remain key variables affecting the market outlook.

In addition, as a critical component in the AI era, demand for HBM is expected to remain high. TechInsights, in its latest market forecast, points out that driven by strong demand for HBM and QLC NAND in AI applications, global memory chip sales are expected to grow by 20% in 2025, reaching US$203.1 billion.

The NAND Flash market is also gradually showing signs of recovery. TrendForce predicts that, under the combined effects of manufacturers' continued production cuts, the gradual depletion of inventory in the smartphone industry chain, and the growing demand for enterprise SSDs (eSSDs) from AI servers, NAND flash and SSD prices are expected to rise by 10%–15% in the third quarter of 2025 and may further increase by 8%–13% in the fourth quarter.

Downstream, in the traditional consumer electronics sector, AI PCs and AI smartphones are highly anticipated by the industry and are seen as new growth points that could disrupt the existing market and stimulate replacement demand.

Liu Ming believes that the widespread adoption of AI PCs this year and the penetration of various AI large models into terminals will bring new demand growth for memory.

For instance, in the AI glasses sector, which has seen significant interest this year, many domestic memory producers have made promising progress. A reporter from Cailian Press learned from the industry that Kwinon Semiconductor's ePOP embedded memory chip has been successfully integrated into devices, becoming an important solution for lightweight AI glasses design. Biwin Storage recently stated at an earnings briefing that it expects its revenue from AI glasses products to increase by over 500% YoY in 2025.

However, the latest data from TrendForce shows that the overall shipment growth expectations for notebook brands in 2025 have been revised downward. Whether the AI concept can quickly translate into large-scale end-user consumption demand remains to be tested by the market.

During this period of industrial transformation, "localisation" has brought structural development opportunities for China's domestic memory producers. Liu Ming expressed optimism about this in his conversation with a Cailian Press reporter: "In 2023, the market share of domestically produced memory chips in the global market was less than 7%, but it increased to approximately 12% in 2024, representing a remarkable growth rate. "We anticipate that the proportion of domestically produced chips will continue to rise this year."

She further analyzed that international major producers such as Micron and Samsung are gradually withdrawing from the market competition for certain mid-to-low-end or specific types of products, objectively providing valuable market space and customer introduction opportunities for local producers. "Local memory producers represented by YMTC and CXMT have continued to make breakthroughs in product technology and market expansion. YMTC has already mass-produced 128-layer NAND flash memory and has delivered 192-layer 3D NAND flash memory samples to a few customers. CXMT has also made progress in the DRAM field, laying the foundation for the development of the domestic DRAM industry. Domestically produced memory chips are continuously narrowing the technological gap with the international leading level, with significant room for technological catch-up and market substitution."

"Meanwhile, after several years of market cultivation and changes in the trade environment, customers' acceptance and willingness to use domestically produced memory chips have significantly increased," Liu Ming further stated.

An executive from another domestic memory chip producer also said in a recent interview with a Cailian Press reporter that the validation period for entering high-end product lines such as automotive previously often took 2-3 years, but now the time has been greatly shortened. "We've already had producers approaching us for cooperation even before our new products are launched."

GigaDevice (603986.SH) also mentioned in its 2024 annual report that with international major producers gradually exiting the niche DRAM market, it is expected to bring opportunities for domestic producers deeply engaged in this field to increase their market share.

It is worth noting that the rise of domestically produced memory chips is not without challenges. Local enterprises still face a relatively significant technological generation gap and patent barriers compared to international giants in cutting-edge technology fields such as HBM and the most advanced DRAM processes.

In addition, the current business focus of most A-share memory module producers is still on the consumer electronics market, with their performance being significantly affected by the cyclical fluctuations of this market and facing fierce price competition. The self-controllable capability of the supply chain, particularly the stable acquisition of upstream key equipment, materials, and high-end wafers, remains a critical bottleneck restricting the development of some local enterprises.

(Liu Ming, the interviewee in the article, is a pseudonym.)