Bernstein: Memory Prices Set for Peak Gains in Q2, but Q3 Will See a Notable Slowdown
Alina Collins
Bernstein's June tracker shows DRAM and NAND contract prices rose ~60% quarter-on-quarter in Q2, slightly beating forecasts — but demand destruction on the consumer side is emerging, and Q3 gains will narrow sharply, closing the pricing peak window for the memory sector.
How big was the Q2 DRAM rally, and which segments led?
Weighted-average conventional DRAM contract prices rose 64% QoQ in Q2 — above Bernstein's prior model forecast.
By segment: PC DRAM up ~46%, server DRAM up ~53%, mobile DRAM up ~80%, consumer DRAM up ~85%.
This means → the closer a segment sits to the end consumer, the harder it was cut in the downturn — and the sharper its restocking bounce.
How tight is the server DRAM supply-demand gap?
May server DRAM contract prices rose another 0–3% MoM; the blended average sat ~53% above Q1.
Suppliers keep tilting capacity toward server DRAM; wafer capacity freed by the delayed HBM4 — the next generation of high-bandwidth memory — ramp was quickly absorbed by strong demand.
U.S. cloud providers remain the priority allocation; long-term agreement (LTA) talks with Chinese cloud vendors are still ongoing and are expected to yield smaller volumes on less favorable terms.
In plain terms = server memory is still a seller's market — AI demand eats up capacity, and Chinese buyers are further back in the queue.
Can smartphone OEMs absorb these price hikes?
Samsung and Micron demanded mobile DRAM price increases of 80%+ for Q2; SK Hynix initially quoted 55–60%. TrendForce expects final pricing near 80%.
After two consecutive quarters of sharp increases, smartphone OEMs have started cutting production plans — TrendForce projects a 16% drop in smartphone shipments this year.
This means → demand destruction is materializing: prices rose too fast, downstream buyers are pulling back, and that will cap second-half gains. Mobile DRAM increases are expected to narrow to 0–10% per quarter in H2.
What is happening on the NAND side?
May NAND wafer contract prices rose only 1–2% MoM — momentum is fading as module makers grow cautious about buying expensive wafers.
But mobile NAND (eMMC/UFS) contract prices are set to rise 75–80% in Q2, and SSD contracts ~70%, propping up an overall blended NAND gain of ~60%.
In plain terms = upstream wafers have stalled, but downstream finished products — phone storage and SSDs — are still climbing. Module makers are squeezed from both ends.
Bernstein remains structurally cautious on NAND, mainly because competitive pressure from Chinese producers — especially YMTC — continues to build.
What signals are the spot market and LTA talks sending?
May PC DRAM spot prices recovered: DDR4 up 5% MoM, DDR5 up 7.4%; server DRAM module spot prices rose 1.6–3.1%.
Server DDR5 module spot prices still sit well above contract prices — this reflects a persistent supply-demand gap. With AI demand holding firm, a sharp near-term spot sell-off looks unlikely.
On LTAs, suppliers have largely wrapped up talks with U.S. cloud vendors; negotiations with Chinese cloud vendors and consumer-side clients are still in progress. Bernstein argues the wider the LTA coverage, the bigger the cushion if the market pulls back.
What is the outlook beyond Q3 — where is the inflection?
Bernstein raised its Q3 PC DRAM price forecast to 8–13% QoQ (from 3–8%), but that is still a sharp deceleration from Q2's 46%. Q4 is expected to slow further.
Ratings: Bernstein keeps Samsung, SK Hynix, Micron, and SanDisk at Outperform, and Kioxia at Underperform.
This means → Bernstein's base case is that memory prices will likely peak in H2 2027 and begin normalizing in 2028 as new capacity comes online. Whether Q2's above-forecast gains can extend beyond Q3 depends on how deep and how long consumer-side weakness runs.
Content is for reference only, not financial advice.