Samsung Electronics and SK Hynix, the world's two largest DRAM manufacturers, have informed customers they will significantly raise DRAM prices in the second quarter. With surging global artificial intelligence investment driving DRAM demand far beyond the two companies' supply capacity, some analysts project price increases could reach 130% for the full year.
According to semiconductor industry sources on March 27, Samsung Electronics and SK Hynix have notified customers of Q2 DRAM supply price increases and entered price negotiations. While the magnitude of increases varies by customer, sources indicate that non-major buyers will need to accept substantial price hikes to secure DRAM allocations.
"Samsung Electronics' current production capacity can only meet about 60% of continuously surging DRAM demand," an industry official said. "Customers are also focused on securing volume rather than resisting price increases, so significant price hikes should face little resistance."
Some industry observers suggest certain customers may need to accept prices more than double their previous contract rates to receive DRAM allocations. The DRAM price surge that began in the second half of last year amid the AI infrastructure boom has fundamentally altered trading practices, widening the purchasing power gap between large and small buyers.
Typically, global big tech companies such as Nvidia and Apple hold advantageous positions in semiconductor DRAM purchasing. Big tech firms that purchase DRAM in large volumes negotiate contracts on quarterly or semi-annual bases, setting volume and price ranges, with final supply prices adjusted to market rates at delivery. Samsung Electronics and SK Hynix maintain preferential pricing policies for big tech buyers who purchase large volumes regardless of market cycles to preserve their supply chains.
However, small and mid-sized customers have traditionally signed contracts reflecting monthly market prices. Since Q4 last year, when DRAM prices began surging, these customers have reportedly shifted to quarterly volume-setting contracts favorable to Samsung and SK. Consequently, Samsung Electronics and SK Hynix have presented substantial price increase proposals to customers facing Q2 contract renewals.
"Contract volumes for both large and small customers will see product price increases reflecting market prices," another industry official explained. "However, when existing contracts expire and new ones are signed, there is no agreed price range, so price increases will inevitably be larger."
Analysts project DRAM prices could more than double this year. On March 27, global market research firm Gartner forecast that memory prices, including DRAM and solid-state drives, will rise 130% by year-end.
According to market research firm DRAMeXchange, DDR4 8Gb product prices stood at approximately $1.30 in March last year, rose to $9.30 by year-end, and surged another 40% to $13 by February this year.
Industry experts view the chip price surge not as a temporary supply-demand imbalance but as a structural problem where supply cannot keep pace with long-term demand. This stems from the AI industry's transition from simple search functions to "agentic AI" that replaces human expertise. As agentic AI is adopted across enterprises, governments, and personal smartphones, demand for DRAM that supports inference and computation continues to explode.
Meanwhile, the three major memory makers' DRAM production capacity this year is expected to remain flat or increase by only about 7% (SK Hynix) compared to last year. "As companies adopt not just one AI but two or three for different purposes, DRAM demand keeps growing," an industry official said. "Since next year's volume is already sold out, the price increase trend is expected to continue."
