Morgan Stanley: ZAM Memory
> Massive Cloud Capex Exposure: Cloud memory spending is projected to reach US$418 billion by 2030, representing an 8% CAGR from 2026. Memory spending could account for 40% of total cloud capex in 2027 (up from just 12% in 2023, prior to the AI boom).> Bandwidth Lags Behind Processing: Memory bandwidth improvements (e.g., a +14% increase from DDR5-5600 in 2024 to DDR5-6400 in 2026) are failing to keep pace with explosive token growth, which expanded over 320x between April 2024 and June 2026 on major cloud platforms.> Absolute Spend Peaking: Absolute cloud memory spending is forecasted to hit its cycle high in 2028e at roughly US$520 billion.> The Post-2028 Softening: From 2028e to 2030e, even though overall cloud capex (excluding memory) is projected to rise to its highest level of $1.28\text{ trillion}$ by 2030, memory spending falls as a percentage of the total budget back down to 25% by 2030e.DRAM Supply/Demand (S/D) Imbalance> Historical Context: The severe supply shortage of 2023 is clearly visible, bottoming out in 4Q23 near -28%. > The Current 2026/2027 Tightness: Following a brief macro recovery, the market enters a sustained period of deep supply deficit. Through all of 2026e, the supply deficit hovers continuously between -10% and -16%. > Supply Shortage to Persist: Looking ahead, the green bars indicate that the market remains structurally undersupplied, keeping DRAM conditions historically tight all the way through 4Q28e.NAND Supply/Demand Dynamics> The COVID/Post-COVID Glut: The massive NAND oversupply of late 2022 is prominent, peaking in 4Q22 with a +17% surplus. > Structural Repricing Phase: After hitting a deep shortage in 1Q26e (dipping near -9%), the NAND deficit begins to gradually moderate, though it remains marginally in negative territory (undersupplied) near -3% to -4% through late 2026e. > Transition to Enterprise Storage: This sustained tightness supports the report's thesis that NAND is moving from cheap consumer sockets up the memory hierarchy to act as massive LLM KV caches.$DRAM $Micron Tech(MU.US) $Sandisk(SNDK.US) $Western Digital(WDC.US) $EWY
The copyright of this article belongs to the original author/organization.
The views expressed herein are solely those of the author and do not reflect the stance of the platform. The content is intended for investment reference purposes only and shall not be considered as investment advice. Please contact us if you have any questions or suggestions regarding the content services provided by the platform.
Post your comment
No Comments