AI Computing Power Bottleneck Shifts to Memory, Three Giants Exceed Trillion-Dollar Valuations

Overview

This research report published by the Deutsche Bank Research Institute focuses on the core bottleneck of artificial intelligence (AI) development in 2026—the memory chips. It points out that due to a fundamental change in AI demand structure, the market has seen unprecedented supply shortages, driving SK Hynix, Micron Technology, and Samsung Electronics, the three major players, beyond a trillion-dollar valuation. The report provides an in-depth analysis of the underlying drivers behind this phenomenon, the groups affected, and mechanisms for cost transmission, along with its implications for macroeconomics and the geopolitical tensions between China and the United States.

Core views

The memory market is experiencing parabolic growth. In 2026, memory chips are no longer just commodities subject to cyclical fluctuations but have become the critical factor constraining AI computing power. SK Hynix, Micron Technology, and Samsung Electronics, as absolute leaders in the global DRAM market (with combined shares exceeding 90%), have all exceeded a valuation of one trillion dollars. This geometric increase in valuation reflects the market’s re-pricing of the scarcity of memory resources. Supply-demand imbalance and cyclical anomaly. Unlike traditional demand fluctuations, the current shortage of memory is driven by a fundamental transformation in AI demand structures. The demands of AI model training and inference for high-bandwidth memory (HBM) and other premium storage products have surged, causing a structural supply gap. The report emphasizes that this cycle fundamentally differs from historical cycles, and its duration and intensity may exceed market expectations. Cost transmission and macroeconomic impact. Further exploring who bears the burden of this 'memory crisis,' the report discusses how both businesses and end consumers face pressure from rising costs, though whether they can fully offset these pressures depends on their bargaining power within respective industries. Additionally, the shortage of memory chips has become a key battleground in U.S.-China technological rivalry, highlighting growing geopolitical significance and potentially reshaping the global technology supply chain landscape.

Analysis framework

Utilizing a thematic research framework, the report first quantifies the extraordinary prosperity of the memory industry through valuation data to establish its status as an AI bottleneck. Then, it dissects how changes in AI demand structures lead to supply shortages from a supply-demand perspective, contrasting this with historical cycles to highlight the uniqueness of the present situation. Finally, extending micro-industry analysis to a macro level, it evaluates mechanisms for cost transmission and geopolitical risks, forming a complete logical chain from industry to macroeconomics.

Methodology notes

• Industry/Industrial Analysis FrameworkSupply and Demand Framework

  Supply and Demand Framework

  Through analyzing supply shortages caused by shifts in AI demand structures, the report employs the supply and demand framework to explain the underlying logic of soaring prices and valuations in memory chips.

• Industry/Industrial Analysis FrameworkIndustry Concentration Analysis

  Industry Concentration Analysis

  Highlighting that SK Hynix, Micron, and Samsung control over 90% of the DRAM market, the report uses industry concentration analysis to illustrate how oligopolistic dominance affects market pricing power and valuation.

• Macroeconomic framework

  Geopolitical Analysis of Science and Technology Competition

  Placing the shortage of memory chips within the context of U.S.-China technological competition, the report analyzes the geopolitical implications of memory chips as strategic resources, falling under the category of geopolitical analysis in macro strategies.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• SK Hynix

  Beneficiary

  Strengths

  Major participant in the global DRAM market, with a market value exceeding one trillion dollars, benefiting from surging AI-driven demand for memory

  Comparison

  Oligopolistically dominant alongside Micron and Samsung

• Micron (Micron Technology)

  Beneficiary

  Strengths

  Major participant in the global DRAM market, with a market value exceeding one trillion dollars, benefiting from surging AI-driven demand for memory

  Comparison

  Oligopolistically dominant alongside SK Hynix and Samsung

• Samsung Electronics (Samsung)

  Beneficiary

  Strengths

  Major participant in the global DRAM market, with a market value exceeding one trillion dollars, benefiting from surging AI-driven demand for memory

  Comparison

  Oligopolistically dominant alongside SK Hynix and Micron

Key data

• Three Major Storage Giants' Market Valuation>1 trillion USD per companyValue exceeds one trillion USD per firmSK Hynix, Micron, and Samsung Electronics reached this valuation level by 2026
• DRAM Market Concentration>90%More than 90%These three firms collectively command global DRAM market share

Impact & implications

The study posits that memory chips have emerged as a hard constraint on AI progress, with ongoing shortages continually pushing up related hardware costs. For downstream enterprises, the ability to effectively pass on increased costs will be crucial in determining profitability differentials. Geopolitically, control over memory technologies further exacerbates risks associated with decoupling between the U.S. and China, prompting countries to likely increase policy support for domestic memory industrial chains.

Risks

• Macroeconomic volatility could result in lower-than-expected capital expenditures on AI
• Escalating geopolitical conflicts might disrupt the global supply chain
• Technological obsolescence risk

What to watch

• Subsequent trends in memory chip prices
• Continuity of storage demand from AI firms
• Policy changes in semiconductors between the U.S. and China