DRAM Prices Stabilize as Downstream Inventory Cuts Take Effect in Q2 2025

The Memory Market Shuffle: What’s Happening?

If you’ve been keeping an eye on the tech landscape, you might have noticed some intriguing shifts in the memory supply chain. According to the latest insights from TrendForce, the recent U.S. tariff hikes have sent a ripple effect through the industry, prompting many brands to scramble and frontload their shipments into the first quarter of 2025. This rush is all about reducing inventory levels, and it’s changing the game for memory prices as we look ahead.

DRAM Prices: A Mixed Bag Ahead

So, what can we expect for DRAM prices in the upcoming months? Well, conventional DRAM is projected to see a modest decline of about 0-5% quarter-over-quarter. However, if you look at the bigger picture, including HBM (High Bandwidth Memory), things are looking a bit brighter with a forecasted increase of 3-8%. This uptick is largely driven by the rising shipments of HBM3E 12hi, which is gaining traction in both PC and server markets.

Now, let’s talk about the major players in this space. Major PC OEMs are feeling the pressure and are asking their ODMs to ramp up production. Why? It’s all about ensuring a stable supply of DRAM for the second half of 2025. Those with lower inventory levels are likely to step up their procurement from suppliers in Q2. On the flip side, while Samsung is making strides in HBM qualification, it hasn’t significantly shifted its capacity back to conventional DRAM. Meanwhile, SK hynix is laser-focused on server and mobile DRAM, which means they’re limiting the supply of PC DDR5. As for DDR4? It’s struggling due to sluggish consumer demand and an influx of capacity from Chinese suppliers, leading to a flat outlook for PC DRAM prices in Q2.

Server DRAM: A Bright Spot Amidst the Chaos

Now, let’s shine a light on server DRAM, which is seeing some exciting developments. The top three North American cloud service providers are ramping up their procurement of general-purpose servers, alongside a surge in AI server investments in China. This uptick is pushing server ODM utilization to new heights, creating a robust demand for DDR5. Although suppliers are gradually transitioning DDR4 capacity to DDR5, the initial supply remains quite tight.

And here’s where it gets interesting: the demand for HBM is soaring, especially with nVidia’s B200 and B300 series making waves. This surge is putting additional pressure on capacity allocation. As a result, we can expect DDR5 prices to stabilize in Q2, while DDR4 prices may not decline as much as anticipated, leading to an overall flat average contract pricing.

Mobile DRAM and Graphics: A Slight Upswing

Switching gears to mobile DRAM, we’re seeing a bit of a rebound thanks to China’s smartphone subsidies and a slight uptick in high-end smartphone shipments. The demand from PC and server applications is also driving up the bit consumption of LPDDR5X. While LPDDR4X supply is plentiful due to aggressive expansions by a Chinese vendor, prices are only expected to dip modestly by 0-5%. On the other hand, LPDDR5X remains in tight supply, which is likely to support a projected increase of 0-5% quarter-over-quarter.

As for graphics DRAM, GDDR7 is expected to see demand primarily from next-gen graphics card stocking. Prices for GDDR7 are anticipated to remain flat or dip slightly due to tight supply. GDDR6, on the other hand, is projected to decline by just 3-8%, buoyed by interest from DeepSeek’s open-source AI model. With GDDR7 production ramping up, the supply is still a bit inconsistent. To combat price drops, major DRAM suppliers are bundling GDDR6 to stabilize contract pricing and clear out inventory.

Consumer DRAM: Signs of Recovery

Looking at the consumer DRAM segment, there’s a silver lining on the horizon. New infrastructure rollouts, including 4G/5G base stations and fiber upgrades, are expected to gradually boost demand. With healthy inventory levels, we might see more aggressive purchasing, paving the way for a return to quarter-over-quarter growth.

However, on the supply side, DRAM manufacturers are taking a more cautious approach as we head into the second half of 2024. They’re cutting back on DDR3 and DDR4 production in response to inventory pressures and weak end-market demand. This strategy is likely to lead to a 0-5% increase in DDR4 contract prices in Q2 2025, as production slows and demand begins to rebound. Meanwhile, DDR3 prices are expected to remain flat, weighed down by previous overstock levels despite recent procurement activity.

In summary, the memory market is navigating some choppy waters, but there are glimmers of hope amidst the uncertainty. Whether you’re a tech enthusiast or a professional in the industry, it’s definitely a space worth watching. What do you think will happen next?

Background Information

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About nVidia:

NVIDIA has firmly established itself as a leader in the realm of client computing, continuously pushing the boundaries of innovation in graphics and AI technologies. With a deep commitment to enhancing user experiences, NVIDIA's client computing business focuses on delivering solutions that power everything from gaming and creative workloads to enterprise applications. for its GeForce graphics cards, the company has redefined high-performance gaming, setting industry standards for realistic visuals, fluid frame rates, and immersive experiences. Complementing its gaming expertise, NVIDIA's Quadro and NVIDIA RTX graphics cards cater to professionals in design, content creation, and scientific fields, enabling real-time ray tracing and AI-driven workflows that elevate productivity and creativity to unprecedented heights. By seamlessly integrating graphics, AI, and software, NVIDIA continues to shape the landscape of client computing, fostering innovation and immersive interactions in a rapidly evolving digital world.

  

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About Samsung:

Samsung, a South Korean multinational conglomerate, has established itself as a global leader in various industries, including electronics, technology, and more. Founded in 1938, Samsung's influence spans from smartphones and consumer electronics to semiconductors and home appliances. With a commitment to innovation, Samsung has contributed products like the Galaxy series of smartphones, QLED TVs, and SSDs that have revolutionized the way we live and work.

  

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About SK hynix:

SK Hynix is a important South Korean semiconductor company known for its innovative contributions to the global technology landscape. Specializing in the production of memory solutions, SK Hynix has played a vital role in shaping the semiconductor industry. With a commitment to research and development, they have continuously pushed the boundaries of memory technology, resulting in products that power various devices and applications.

  

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Technology Explained

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DDR3: DDR3 (double data rate 3) is a type of computer transfer technology that is commonly used in modern computers. It is the successor to the original DDR and DDR2 technologies used to communicate data between the main memory and the CPU (central processing unit). It works by allowing two sets of information to be sent per clock 'tick', which helps to boost overall speed and efficiency. With DDR3, the computer industry has seen a significant increase in speed and performance. DDR3 is used in a variety of computer applications, from gaming to intense data processing and artificial intelligence tasks. It is used in PCs, laptops, and Macs, as well as in tablet technologies like the iPad. It also helps to provide better video streaming and signal data processing in networking. DDR3 is an essential and versatile technology in the modern computer industry.

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DDR4: DDR4 is a generation of Double Data Rate (DDR) dynamic random access memory (RAM) technology. It is a type of RAM that utilizes a higher clock frequency and is more power-efficient than its predecessors. As a result, it is capable of processing data more quickly than other RAM in the computer industry. Its increased speed and power efficiency are beneficial for applications such as gaming, rendering, and machine learning. It is designed for high-performance computing and enables faster access to stored information, resulting in better overall performance for the user. Furthermore, because of its low voltage requirements it requires less power consumption, making it an attractive option for many computer systems. DDR4 is set to become the primary RAM in most computer systems as the industry transitions away from its predecessors.

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DDR5: DDR5 (Double Data Rate 5) is the next generation of memory technology for the computer industry. It is a modern day improvement on earlier DDR technologies, with faster speeds, greater bandwidth and higher capacities. DDR5 enables higher resolution, seamless gaming experiences and faster data transfer rates, making it an ideal choice for high-performance computing and 4K gaming. With its greater RAM compatibility, DDR5 provides faster buffering times and raised clock speeds, giving users an improved overall work system. DDR5 is also optimized for multi-tasking, allowing users to multitask without experiencing a significant drop in performance, increasing the productivity of digital tasks. As an ever-evolving technology, DDR5 is paving the way for the computer industry into a new and powerful era.

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GDDR6: GDDR6 stands for Graphics Double Data Rate 6th generation memory. It is a high performance memory used in graphics cards and graphics processing units (GPUs), specifically targeting gaming, AI and deep learning-related applications. GDDR6 achieves higher bandwidth than previous generations, allowing faster and smoother gaming experience for users. It is also more power efficient, resulting in lower energy consumption overall. The improved power efficiency makes it adaptable to today's needs of thinner laptops and ultra-high definition gaming laptops. Additionally, GDDR6 is used in storage solutions and advanced data center applications to help streamline large amounts of data at lightning-fast speeds.

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GDDR7: GDDR7 (Graphics Double Data Rate 7) is the seventh generation of graphics double data rate (GDDR) memory. It is a type of dynamic random-access memory (DRAM) that is specifically designed for use in graphics cards. GDDR7 memory offers a number of advantages over previous generations of GDDR memory. GDDR7 is a significant improvement over previous generations of GDDR memory. It offers faster speeds up to 32 gigabits per second (Gbps) per pin, lower power consumption, and improved error correction. This makes it ideal for use in high-performance graphics cards and other applications that require high bandwidth and low latency.

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HBM3E: HBM3E is the latest generation of high-bandwidth memory (HBM), a type of DRAM that is designed for artificial intelligence (AI) applications. HBM3E offers faster data transfer rates, higher density, and lower power consumption than previous HBM versions. HBM3E is developed by SK Hynix, a South Korean chipmaker, and is expected to enter mass production in 2024. HBM3E can achieve a speed of 1.15 TB/s and a capacity of 64 GB per stack. HBM3E is suitable for AI systems that require large amounts of data processing, such as deep learning, machine learning, and computer vision.

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LPDDR5X: LPDDR5X is a type of computer memory technology that is used in many modern computers. It stands for Low Power Double Data Rate 5X and is a type of Random Access Memory (RAM). It is designed to be more efficient than its predecessors, allowing for faster data transfer speeds and lower power consumption. This makes it ideal for use in laptops, tablets, and other mobile devices. It is also used in gaming consoles and other high-end computers. LPDDR5X is capable of transferring data at up to 8400 megabits per second, making it one of the fastest types of RAM available. This makes it ideal for applications that require high performance, such as gaming, video editing, and 3D rendering.

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