Storage production capacity is fundamentally unable to keep up! Micron warns: shortages will continue until after 2026.

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The AI computing power arms race is pushing the global storage chip market into a multi-year supply shortage.

Micron Technology management stated at JPMorgan's annual technology summit that The supply shortage of HBM, DRAM, and NAND storage chips is expected to last far beyond 2026. The core driving force comes from the strong demand for high-performance storage in AI applications, while the supply side is constrained by technical bottlenecks that make it difficult to quickly expand production.

JPMorgan subsequently cited these views in its investment report, stating that after hearing Micron's management statements, the bank is more confident in the logic of a multi-year bull market in the AI storage sector. The supply-demand gap is difficult to reverse in the short term, which provides a clear signal for storage industry investors.

Structural Constraints on Supply Expansion

According to the JPMorgan report, Micron pointed out that the causes of supply shortages in the storage market are structural, and not simply a matter of capacity cycles.

Specifically, the limitations on supply growth mainly come from two aspects: On one hand, the performance improvement of new-generation storage chips is gradually narrowing, meaning the space for expanding effective supply solely through technological iteration has been significantly compressed.

On the other hand, the die size of new-generation HBM chips continues to increase, resulting in fewer chips produced per wafer, further weakening supply elasticity. In addition, although the introduction of extreme ultraviolet (EUV) lithography helps improve the manufacturing precision of advanced DRAM processes, it also imposes new constraints on ramp-up speed and costs.

With these factors combined, even if storage manufacturers actively expand production, it will still be difficult to quickly fill the supply gap created by AI demand in the short term.

HBM4 Mass Production Accelerates, 1-gamma Node Reaches Historic High Output

Regarding product progress, Micron disclosed several key pieces of information.

Micron management stated that driven by the strong demand for AI applications, the company's 1-gamma process node is expected to become its highest DRAM output per wafer in history. HBM memory chips are made by vertically stacking multi-layer DRAM modules and are widely used in AI GPUs. Micron is continuously integrating EUV lithography into the mass production process of the 1-gamma node.

Regarding the iteration pace of HBM products, Micron revealed that the ramp-up speed for mass production of HBM4 is twice that of HBM3. The mass production ramp for the next-generation HBM4E product is expected to start in 2027, with the first batch of samples using DRAM modules produced at the 1-gamma node.

Expansion of AI Inference Demand Boosts SSD Market Share

In addition to HBM and DRAM, Micron also pointed out that the evolution of AI workloads is creating new growth opportunities for its solid-state drive (SSD) business.

Micron management stated that The continuous expansion of AI context windows and rapid growth in inference workloads are driving demand for large-capacity, high-performance storage, which has allowed the company to increase its market share in SSDs.

It is worth noting that Micron emphasized its strategy does not focus on providing standardized spot products, but rather on deep collaboration with customers to customize storage solutions for specific application scenarios. This model helps strengthen customer loyalty and increase product premium.

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