Citigroup warns that the world will face a "severe supply shortage" of memory chips in 2026. According to information from trading desks, Citigroup's latest outlook demonstrates a more aggressive bullish stance than Nomura's. Analysts believe that, driven by the proliferation of AI Agents and a surge in memory demand for AI CPUs, memory chip prices are set for an uncontrollable rise in 2026. The analysts have drastically raised their 2026 average selling price (ASP) growth forecast for DRAM from an initial 53% to a staggering 88%, and for NAND from 44% to 74%.
Pricing power is tilting entirely towards sellers. Citigroup's research team explicitly stated in its latest report that it anticipates a "severe supply shortage" in the commodity memory market by 2026. This shortage is not a temporary supply chain disruption but is driven by structural data growth. Citigroup has significantly increased its year-on-year ASP growth forecast for DRAM (Dynamic Random Access Memory) in 2026 from a previous +53% to +88%. The data for server DRAM is even more startling. Citigroup expects that, propelled by both AI training and inference demand, server DRAM ASP will skyrocket by 144% year-on-year in 2026 (up from a previous forecast of +91%). Taking the mainstream 64GB DDR5 RDIMM product as an example, Citigroup predicts its price will reach $620 in the first quarter of 2026, a sequential increase of 38%, far exceeding the previous forecast of $518.
In the NAND (flash memory) sector, Citigroup is equally assertive, raising its 2026 ASP growth forecast from +44% to +74%. Among these, enterprise SSD ASP is projected to increase by 87% year-on-year. In the analysts' view, the market is entering an extremely intense seller's market, with pricing power completely in the hands of memory giants like Samsung. Based on these aggressive price forecasts, Citigroup has made substantial revisions to the profit outlook for Samsung Electronics. Benefiting from an exceptionally favorable pricing environment, Citigroup expects Samsung's operating profit (OP) to surge to 155 trillion won in 2026, a massive 253% year-on-year increase. This figure is significantly higher than Citigroup's previous forecast of 115 trillion won. Citigroup believes that as DRAM and NAND prices soar, Samsung's profitability will demonstrate remarkable resilience. Consequently, Citigroup has raised its target price for Samsung Electronics directly from 170,000 won to 200,000 won.
Nomura's "Super Cycle" versus Citigroup's "Extreme Shortage". Previously, Nomura introduced the concept of a "triple super cycle" (DRAM, NAND, HBM) in its report, predicting the global memory market size would grow 98% to $445 billion by 2026. However, the two institutions show a significant divergence in their specific judgments on price increases. Nomura forecasts a 46% price increase for DRAM and a 65% increase for NAND in 2026. While these are substantial gains, Citigroup's DRAM increase forecast (88%) is nearly double that of Nomura's. The core of the divergence lies in differing depths of understanding regarding demand. Nomura emphasizes the "dual resonance" of AI servers and general-purpose servers, coupled with the production ramp-up of HBM4; whereas Citigroup further underscores the incremental data generation brought by "AI Agents," arguing this will lead to an explosive growth in data volume, thereby exerting a steeper-than-expected price pull on general-purpose server memory.
Cleanroom Shortages Emerge as a Long-Term Bottleneck. Why are prices becoming so uncontrollable? Beyond the demand explosion, physical constraints on the supply side are another critical factor. Nomura Securities astutely pointed out in its report that supply expansion in the global memory industry is severely constrained by insufficient availability of "cleanrooms." Nomura emphasizes that even if manufacturers decide to expand production now, substantive supply-side expansion will be very limited until at least mid-2027 due to cleanroom shortages. Furthermore, technology migrations (such as the transition to 1c-nanometer processes) can actually lead to a 10-15% reduction in wafer capacity, coupled with lower initial yields. This implies that the supply side has almost no capacity for a rapid response to the AI data explosion anticipated by Citigroup. This supply-demand mismatch is the fundamental logic behind Citigroup's bold prediction of a near-doubling in DRAM prices.
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