CITIC SEC released a research report stating that the current upcycle in the storage market began in Q2 2025, driven by "supply optimization + AI demand," with mainstream storage prices showing significant absolute gains and historical percentile positioning. Despite the market already transitioning to a "seller's market" in Q4 2025 with steep price increases, CITIC SEC believes the industry is still in the early stages of a supercycle. Shortages are expected to persist over the next six months, with DRAM/NAND and niche storage prices likely to continue rising in H1 2026. Contract prices are projected to accelerate, catching up to spot price gains, and supply-demand imbalances may last until late 2026. CITIC SEC remains optimistic about the sustainability of this cycle.
**Key Historical Cycle Insights**: Demand-driven price surges tend to be more significant and longer-lasting. The 2016–2019 cycle, fueled by Android smartphone memory/storage upgrades and server market growth (DDR4 adoption), saw DRAM/NAND spot prices peak at 223% gains over 12–18 months. In contrast, the 2023Q3–2024Q3 rebound, primarily supply-driven, delivered only 20–70% gains in DRAM spot prices over 8–14 months. Key takeaways: 1) Demand-driven cycles exhibit stronger price resilience. 2) Contract prices lag spot prices by about a quarter but eventually converge. 3) Module prices trail chip prices in timing and magnitude.
**Current Cycle (2025Q2–Mid-November)**: Under "supply optimization + AI demand," DDR4/DDR5 spot prices have surged up to 896%/377%, while NAND Flash rose 282%. Per-Gb prices (adjusted for cost reductions) exceed previous highs. Contract prices remain behind, suggesting further upside. 1) **Drivers**: AI data center demand for HBM, server DRAM, and enterprise SSDs, coupled with limited supply expansion, mirrors the 2016–2018 cycle but with greater momentum. 2) **Price Gains**: As of November 14, DDR4 8/16Gb spot prices are up 324–896% YTD, DDR5 16Gb up 374–377%, and TLC NAND up 117–282%. October contract prices rose just 31–88%, lagging significantly. 3) **Current Levels**: DDR4/DDR5 spot prices hit record highs, with TLC 256/512Gb prices 5–10% above 2024 peaks. Adjusted for tech advances, DDR5 16Gb/512Gb TLC per-Gb prices now surpass 2017 highs by ~110% and 40%, respectively.
**Outlook**: Storage prices are expected to keep rising over the next six months, with contract prices narrowing the gap with spot prices. The boom could extend through late 2026. Since September, the market has shifted decisively to a seller’s regime, with broad-based price hikes accelerating. Key projections: - **Enterprise SSDs**: Contract prices may rise 50%+ in Q4 2025 and Q1 2026. - **Niche Storage**: DDR4 8Gb prices have jumped 350% since March, with further gains in Q4. 2D NAND shortages exceed some niche DRAM, with MLC NAND potentially doubling this year. SLC NAND, up 15%+ quarterly since Q3 2025, could rise 30%+ in H1 2026; NOR may climb 10–15% quarterly.
**Risks**: Weaker-than-expected global macroeconomic recovery; reduced corporate IT/AI spending in欧美; slower AI server or device (PC/phone) demand; delays in产能 adjustments by major suppliers; intensifying competition.
**Investment Strategy**: CITIC SEC favors companies closest to storage manufacturers, benefiting most from the upcycle. Top picks include: 1) Niche storage players with pricing power. 2) Firms with strong enterprise storage exposure and涨价逻辑. 3) SSD/memory配套 chip designers poised for indirect gains.
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