Micron’s memory boom Is cyclicality ending
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Micron’s memory boom Is cyclicality ending
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In Breaking Analysis 322, we shared with you that our forecast of a $1T silicon business arrived 2 years earlier than we had forecast. The reason for our twenty-four month miss was the bottleneck had moved from GPUs to memory. Micron gave us a remarkable datapoint in its FY Q3: DRAM prices rose by more than sixty percent sequentially in the quarter, while the number of bits shipped barely grew. Today we address what that means. The key questions are: Is this temporary scarcity or a structural change in the economics of memory? We believe both forces are at work. This week we participated in a Webcast with Micron President and Chief Technology and Products Officer, Scott DeBoer. The roadmap he showed us underscores the importance of memory with respect to AI performance. New customer take or pay agreements change how risk is shared. At the same time, customers are being forced to adapt to higher costs. Qualitate’s proprietary research gives us a window into those decisions. Our question is whether these changes can make memory less cyclical, and what evidence would tell us that the familiar cycle is returning.