SK Hynix CEO warns 2027 will be memory's worst year ever; HBM and DRAM shortages expected to persist past the decade

The global memory industry is bracing for its most severe shortage in history, according to SK Hynix CEO Kwak Noh-jung. Speaking at his company's Nasdaq trading debut commemoration, the chief executive warned that 2027 will bring the "worst-ever" supply shortages the industry has seen, with demand outpacing production capacity well beyond 2030.

"We forecast that next year will be the worst year in the industry's history from the supply perspective," Kwak stated to Reuters. SK Hynix's outlook aligns with similar warnings from Samsung and Micron. Samsung has flagged 2027 as the worst shortage year, with conditions persisting through 2028 and beyond. Micron has characterized current shortages as only the "first innings," forecasting it can meet just 40–50% of total market demand in coming years, with both DRAM and NAND supplies remaining constrained.

The acute shortage stems from heightened demand from AI customers combined with multi-year supply agreements that have strained the three largest DRAM manufacturers' capacity. SK Hynix, Samsung, and Micron have prioritized premium segments—particularly high-bandwidth memory (HBM) and LPDDR5X—while commodity memory tiers, including DDR5, DDR4, and entry-level LPDDR, have been deprioritized. While this strategy has bolstered the suppliers' profitability, it has devastated the consumer segment, driving dramatic price increases across PCs, smartphones, gaming consoles, and other platforms.

The supply imbalance has created an opening for Chinese semiconductor makers to expand domestically. CXMT and YMTC, major DRAM and NAND producers respectively, are doubling their production capacities to serve Chinese customers. In response, SK Hynix—alongside Samsung and Micron—is undertaking multi-billion-dollar, multi-year capacity expansion programs, including new fabrication facilities across South Korea, with additional fabs under consideration in the United States, Japan, and Southeast Asia. Micron has already begun construction on a new DRAM production facility.