The Memory Cycle.Is probably going to look like th

The Memory Cycle.

Is probably going to look like this chart?

With SK Hynix, $Sandisk(SNDK.US), Samsung, $Micron Tech(MU.US) and others:

-> Price Hikes until 2028

-> Demand Increase Permanent

-> Price Decreases After 2028

-> Increased Capacity * Increased Demand * lower margin = High Profit Anyway.

For example:

2026 Q1: DRAM, NAND Price Hikes

- NAND prices 100%+ Q/Q, DRAM up 70%+.

2026: Q2: DRAM NAND Price Hikes

- Samsung hikes Q2 NAND prices 100%+ Again, DRAM up.

Q3 -> 2028 Price Hikes.

1. Counterpoint: "There is no scenario where memory prices correct in the second half [of 2027], given that hyperscaler purchasing intent remains unbroken"

2. Intel CEO: "No Relief on Memory Shortage Until 2028".

However what people misunderstand:

-> Memory Demand Is Structural with AI.

-> Prices are not.

We'll likely keep seeing price hikes with the extreme memory shortage in 2026.

But prices start to fall in 2028. What people conflate is:

-> Extreme demand for AI will not cause prices to go to 0.

-> More capacity will not cause demand to suddenly go to 0.

More Supply * Price * More Demand * lower operating margin = more profit anyway.

Operating income will not be 10000%+ Q/Q like now.

But if SK Hynix is producing a more steady ~$100B+ operating income Y/Y at a $400B MC from increased capacity but lower margin:

Compared to $100B -> $220B -> $90B -> $120B.

Then that itself looks undervalued.

I don't see a world where it ends up being $100B-> $180B (2027) -> $10B what doomposters are projecting, where they operate at a loss from both demand downturn (eg. smartphones) and margin downturn.

The main two things is to look out for is if software/memory usage gets extremely, extremely efficient or hyperscaler capex suddenly disappears (AI is no longer a thing).

Same could be said around GPUs for training/inference.

But, I would mainly be looking out for hyperscaler capex projections as the #1 indicator. Not random out of context quotes taken from Samsung executives to signal operating income two years out.

AI has fundamentally changed what the "commodity" memory is, similar to GPUs back in 2023.

Source: Serenity