Stories
Global Memory Deficit to Fuel Korean Chip Supercycle Through 2028
- •The global memory shortage is expected to extend the boom for Korean chipmakers Samsung Electronics and SK hynix through 2028, according to The Korea Herald.
- •Micron Technology reported over 75% of its fiscal 2027 production is committed, with discussions shifting to securing 2028 inventories, indicating tightening supply.
- •Micron's CEO Sanjay Mehrotra noted that memory and storage supply-demand conditions will be "much tighter" in fiscal 2027 and 2028 compared to 2026.
- •Buyer behavior has shifted to multi-year commitments, with Micron expanding long-term strategic customer agreements and Samsung and SK hynix securing similar deals.
- •The redirection of advanced DRAM wafer capacity to HBM manufacturing is restricting standard DRAM availability, driving up prices and boosting earnings projections for South Korean manufacturers.
Key Questions Answered
The chip supercycle is extended due to a deepening global memory deficit and persistent supply constraints that are expected to endure through 2028. This trend gained traction after Micron Technology reported that over 75 per cent of its planned fiscal 2027 production is already committed, with buyers actively locking in 2028 inventories.
Samsung and SK hynix have secured multi-year supply contracts with major data-centre operators and large clients. Samsung entered agreements with five key operators to place up to 70 per cent of its forward capacity under contract, while SK hynix concluded parallel five-year supply agreements with about 10 major clients.
Market consensus compiled by FnGuide projects Samsung Electronics' operating profit at 110.3 trillion won and SK hynix's at 78.1 trillion won, bringing their combined operating total to an estimated 188.3 trillion won. However, DS Investment & Securities maintains a more conservative outlook, estimating lower figures of 104 trillion won and 70 trillion won respectively.
