Micron predicts the memory crisis will last beyond 2026, says it can't meet full demand

DDR5 prices aren't coming down anytime soon

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Forward-looking: The memory crisis isn't going to alleviate until at least 2027. That's the opinion of Micron CEO Sanjay Mehrotra, who also revealed that the company will only be able to meet half to two-thirds of demand from its "key customers." That's bad news for PC fans, but good news for Micron, which reported record revenue during the quarter.

Micron, which retired its popular Crucial brand earlier this month after almost 30 years, reported revenue of $13.64 billion for the first fiscal quarter, up 57% year-over-year. Net income was up from $2 billion to $5.2 billion, and earnings per share were $4.78, beating the expected $3.94.

Micron said the impressive results were due to massive demand from AI data centers, resulting in higher memory prices.

"Over the last few months, our customers' AI data center build-out plans have driven a sharp increase in demand forecast for memory and storage," Mehrotra said. The CEO added that industry supply will remain substantially short of the demand for the foreseeable future – "beyond calendar 2026."

Mehrotra said the two fabs it was working on in Idaho and plans for a fab in New York were progressing well; they will start making memory in 2026 and 2027. He added that efforts to create HBM4 memory are also going well, with yields increasing faster than when Micron started production of HBM3.

A sobering sight on Newegg

Despite the expansion, Mehrotra said Micron's customers are concerned about long-term access to memory, and that it would only be able to meet "half to two-thirds" of demand from its key customers, many of whom are securing multi-year contracts.

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Mehrotra also said that the increasing use of AI to produce videos and the move from AI training to inferencing will increase demand for solid-state disks. He expects smartphone and PC manufacturers will want more memory to ensure they can handle AI tasks, too.

DRAM prices are already stupidly high as the AI boom continues to drive demand. It was reported last month that some physical retailers weren't even listing DDR5 prices as they were changing so quickly. It's now at the point where 64GB of DRR5 can cost more than a PS5 or even a mid- to higher-end graphics card.