The global memory market is enjoying a strong surge in demand, yet leading manufacturers are taking a careful approach to expanding production as they try to avoid repeating past oversupply problems that hurt profits across the semiconductor industry. Samsung Electronics and SK hynix are currently benefiting from strong demand for DRAM and high-bandwidth memory, but both companies are studying demand trends closely while deciding how much capacity they should add over the next few years.
Demand for memory chips has increased sharply because artificial intelligence infrastructure requires large amounts of high-performance memory, and this has pushed DRAM contract prices higher with dramatic increases that show how tight supply has become. At the same time, manufacturers remember the slowdown that followed the pandemic era when weak PC and enterprise demand created excess inventory that took several quarters to clear.
Chosun Biz reports that Samsung expects the DRAM supercycle to slow by 2028, which explains why the company is cautious about committing too much capital to aggressive expansion plans that could later create another oversupply situation.
Samsung and SK hynix are holding back
Memory suppliers are expanding next generation production lines while keeping investment plans under strict control because forecasting demand in the semiconductor industry has become increasingly difficult. AI infrastructure demand continues to grow, yet companies understand that rapid expansion during a boom often creates problems once demand stabilizes.
Samsung is transitioning to newer DRAM manufacturing processes at its Hwaseong facility and expanding additional production capacity at its Pyeongtaek campus. Meanwhile, SK hynix is building new DRAM production lines at its M15X plant while expanding manufacturing across key sites such as Icheon, Cheongju, and Yongin.
Both companies are also increasing output of high bandwidth memory because major technology firms including NVIDIA, AMD, and Broadcom require large volumes of advanced memory for AI systems.
AI demand drives shortages across the industry
As manufacturers allocate more production toward HBM chips used in AI hardware, the supply of traditional DRAM used in smartphones, PCs, and servers has tightened, which explains the sharp increase in memory prices across consumer and enterprise markets.
At the same time, industry competition continues to grow because Micron is expanding DRAM manufacturing in the United States, Singapore, and Taiwan, while companies such as Kioxia and YMTC are increasing NAND flash production capacity. Analysts expect that once new factories become operational around 2028, global memory output will rise significantly and supply conditions may shift again across the semiconductor market.
