Kioxia Memory Sold Out Through 2026, Extending High Prices
▼ Summary
– Memory chip makers are experiencing record profits due to AI-driven demand, with no significant market improvement expected before 2026.
– Both RAM and SSD prices are expected to remain high, with Kioxia’s manufacturing capacity sold out through 2026.
– Companies feel compelled to continuously invest in AI to avoid being eliminated, sustaining the cycle of high demand and prices.
– Kioxia is increasing its manufacturing capacity by improving yields at one factory and starting mass production at another.
– Chip shortages persist because building new factories takes years, and companies are cautious about over-expanding capacity.
The global demand for memory chips, driven primarily by the explosive growth of artificial intelligence, shows no signs of slowing down. Industry leaders are now forecasting that supply constraints and elevated pricing will persist well into 2026, affecting everything from data center hardware to consumer components. This sustained shortage means that both RAM and SSD prices are likely to remain high for the foreseeable future, with no immediate relief in sight for buyers.
A senior executive from Kioxia, the major memory manufacturer, has confirmed this outlook. The company reports that its production capacity is completely booked through the end of 2026. This situation is pushing the entire solid-state drive market into what is described as a prolonged period of premium pricing. The pressure stems from relentless investment in AI infrastructure, as businesses fear falling behind if they pause their technological spending.
According to the executive, there is a pervasive anxiety among corporations. The prevailing belief is that halting investment in AI could lead to immediate competitive disadvantage, forcing a continuous cycle of capital expenditure. This dynamic creates a feedback loop where demand for memory from data centers building generative AI capabilities stays intensely strong. Without a significant shift in this demand trajectory, the market conditions supporting high prices are expected to continue.
In response to the crunch, Kioxia is working to increase its output. The company is focusing on improving production efficiency at its existing facilities and preparing a new plant to ramp up to full-scale manufacturing. However, these efforts face the inherent delays of the semiconductor industry. Constructing new fabrication plants and bringing them online to produce substantial volumes of chips is a process that takes several years.
History from recent chip shortages illustrates why supply cannot quickly catch up to demand. Manufacturers must also balance expansion with caution. Committing to massive new capacity carries financial risk if market dynamics shift unexpectedly. Companies are wary of being left with surplus, expensive inventory that must be sold at a loss if the AI investment wave were to suddenly recede. This careful approach to scaling production further extends the timeline for market balance, locking in the current seller’s market for years to come.
(Source: Ars Technica)
