SK Hynix held an internal company meeting, where the company reportedly presented some tough pills to swallow for many gamers. The company now forecasts the tight memory supply to last through 2028 for the commodity DRAM, which includes DDR5/DDR4, GDDR6/GDDR7, and LPDDR5x/LPDDR6. All the aforementioned DRAM variants are essential for PC and console components, making millions of gamers at risk of absorbing a massive price increase as a result. As memory supplier inventories deplete, production capacity will not increase to meet demand as it has in the past. This marks a departure from the usual response by memory manufacturers, who typically ramp up capacity in response to demand.
However, an interesting thing that SK Hynix has noted is that this situation will exclude the company's most advanced memory solutions—HBM and SOCAMM. These products are expected to get an additional capacity expansion, without tight supply impacting this part of the DRAM supply chain. These products are even in high demand as they are mostly consumed in higher volume than the regular commodity DRAM, due to their integration into AI products such as GPUs and servers.
SK Hynix has recently started installing more EUV machines, which could become operational in the coming quarters. The company reportedly plans to install 20 Low-NA EUV units over the next two years, all intended for HBM memory and advanced storage solutions. As a result, the planned DRAM expansion capacity will not benefit the commodity DRAM group, as all new capacity from SK Hynix will serve its data center customers. However, not all companies are following this path. Some of SK Hynix's competitors, like Samsung, are reportedly reallocating some of their HBM production capacity to regular DRAM to meet demand.