The memory storage market supercycle, driven by unprecedented AI demand, appears to be in its early to middle stages, with strong upward momentum expected to continue through 2027. Current price hikes have already surpassed historical peaks, signaling a structural shift rather than a temporary imbalance.
SanDisk stock (SNDK), which was acquired by Western Digital (WDC) in 2016 and spun off as an independent public company in late 2025, closed at $503.44 on January 22, 2026. Western Digital stock (WDC) closed at $243.29 on the same day.
Key Insights
Unprecedented Price Jumps: Historically, peak quarterly DRAM price increases were around 35%; however, Q4 2025 saw a 53-58% jump, and Q1 2026 is expected to see gains above 60%. This indicates the cycle's intensity is already exceptional.
Structural Demand Shift: The supercycle is driven by AI computing infrastructure and data center expansion, a more sustainable catalyst than previous cycles fueled by consumer electronics. The memory market is projected to expand to $842.7 billion in 2027 from $551.6 billion in 2026.
Supply Constraints: Major manufacturers like Micron, Samsung, and SK Hynix are prioritizing high-margin HBM (High Bandwidth Memory) and server products, which require significantly more wafer volume, creating a widening supply-demand gap for conventional memory products. This has put suppliers in a dominant position for price negotiations.
Long-Term Outlook: Industry experts and analysts project supply shortages and elevated prices to persist through 2027 and potentially into 2028, with a potential oversupply scenario only possible around 2028-2029 if capacity expands significantly and AI demand moderates.
The current phase is characterized by both extreme price movements and strong fundamental drivers, suggesting the supercycle has substantial run room left, rather than being near its end.
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.
