This wave of storage chip price hikes has come swiftly and violently.
Data from third-party organizations in the flash memory market shows that within less than six months, the DRAM price index has surged by approximately 72%, leading to a comprehensive price increase across the entire storage market.
Industry Giants Sound the Alarm for Price Increases
The tranquility of the storage chip market has been completely shattered. SanDisk was the first to issue a price increase notice, firing the first shot in the storage chip price hike. Industry giant Micron quickly followed suit, not only suspending quotes but also planning to raise prices for its entire range of storage products by 20%-30%.
Micron’s actions are particularly “harsh,” notifying customers that the entire range of storage products including DDR4, DDR5, LPDDR4, and LPDDR5 will stop quoting for a week. The price increase for automotive electronic products is expected to reach as high as 70%, indicating the severity of the supply-demand imbalance in the market.
The latest report from CFM on the flash memory market predicts that in the fourth quarter of this year, global storage chip prices will generally rise, setting the tone for market trends in the spring of next year. This wave of price increases is not a short-term fluctuation but a fundamental change in the industry’s fundamentals.
The Price Hike Wave is Coming Strong
The root cause of the storage chip price increase lies in the severe imbalance of supply and demand. On the supply side, leading manufacturers have actively reduced production over the past few years, shifting capacity from traditional products to high-end products, resulting in a tight supply of traditional storage products.
Starting from April 2025,Samsung, SK Hynix, and Micron have announced the suspension of DDR4 memory production, fully investing in DDR5, LPDDR5, and HBM high-bandwidth memory product lines. Micron has already emailed customers to notify them of the suspension of DDR4/LPDDR4 production, with future supplies only for specific long-term customers.
Samsung plans to completely stop production of 8GB/16GB DDR4 modules by the end of the year; SK Hynix will significantly reduce the proportion of DDR4 production capacity. This series of actions has led to a sharp expansion of the DDR4 supply gap, even resulting in price inversion phenomena.
By June 2025, the price of DDR4 has surpassed that of DDR5 products of the same capacity by a factor of two, indicating the extreme imbalance of supply and demand in the market. According to TrendForce’s survey, in the second half of 2025, the DDR4 market will be in short supply, with prices rising strongly, and it is expected that the last shipment time for DDR4 from various suppliers will be in early 2026.
On the demand side, the explosion of AI has acted like a “nuclear bomb,” instantly igniting a huge demand for storage chips. The demand for high-end storage chips from AI servers and data centers far exceeds that of traditional servers.
Domestic internet giants are increasing their investments in AI,with Alibaba announcing an investment of over 380 billion yuan in the next three years to build cloud and AI hardware infrastructure; Tencent’s president, Liu Chiping, stated that they will increase AI investments in 2025, with expected capital expenditures accounting for a low double-digit percentage of revenue.
Hope for Domestic Substitution Begins to Emerge
As overseas giants shrink their product lines, it brings historic development opportunities for Chinese storage companies. Renowned market research firm Omdia predicts that by 2025, the global DDR5 market size will reach 62 billion USD,with Chinese manufacturers expected to capture over 30% market share, significantly increasing their global market share.
Guosheng Securities analysis points out that as new market demand rises, the reduction and suspension of production by original storage manufacturers, along with price increases and shortages from third-party distributors, are collectively driving the market to accelerate the transition to DDR5 generation products.
As Samsung and other overseas giants adjust their capacity strategies, shifting DDR4 capacity to high-end products, domestic storage manufacturers are highlighting opportunities in the niche DRAM market, ushering in structural development opportunities.
Currently, several A-share listed companies are actively laying out in the storage chip field.Shannon Semiconductor’s self-owned brand “Haipu Storage” is progressing smoothly, completing the R&D and trial production of enterprise-level DDR4, DDR5, and Gen4 eSSD, with excellent product performance and entering the mass production stage.
Lanqi Technology has international leading technical strength in memory interconnect, and as the only Chinese memory interface chip supplier, it will benefit from the development of domestic DRAM manufacturers.
DaPu Microelectronics, as the first unprofitable storage company in the Shenzhen market to pass the IPO, has broken the overseas monopoly with its full-stack self-research capabilities, successfully entering the supply chain of global AI giants, marking thatdomestic storage technology is now capable of impacting the high-end market.
The price surge in the storage chip market continues, and the supply-demand imbalance is unlikely to ease in the short term. The strategic position of storage chips will become increasingly important.