Memory prices rose about 60% in 2QCY26, but the pace of increases is expected to slow in 2HCY26

Overview

This report is Bernstein's monthly Global Memory Tracker, based on May DRAM and NAND spot and contract price data published by TrendForce/DRAMeXchange, tracking storage price increases and supply-demand changes in 2QCY26. The core conclusion is that both DRAM and NAND still saw substantial price increases in 2QCY26, at around 60% and slightly stronger than the model, but slowing consumer demand and subsequent new capacity additions will gradually slow the pace of price increases in 2HCY26, with prices expected to peak and decline from 2HCY27 to CY28.

Core views

On the DRAM side, contract prices rose slightly sequentially in May, with weighted traditional DRAM contract prices up 64% versus 1QCY26; among these, PC DRAM rose about 46%, Server DRAM about 53%, Mobile DRAM close to 80%, and Specialty DRAM about 83%-90%. On the NAND side, wafer contract prices rose only 1%-2% sequentially in May, but Mobile NAND and SSD prices are expected to rise about 70%-80%, supporting an approximately 60% increase in composite NAND contract prices in 2QCY26. The report believes server and AI demand remains strong, consumer demand destruction is temporarily limited, but the pace of DRAM and NAND price increases will narrow markedly after 3QCY26.

Analysis framework

The report maps TrendForce/DRAMeXchange spot and contract quotations to different application scenarios, calculates industry-average ASP changes based on product demand weights, and compares them with Bernstein's model and investor expectations. The DRAM sample covers PC, Server, Mobile, and Specialty DRAM, with HBM considered separately; the NAND sample covers eMMC/UFS and NAND wafers, and additionally considers the impact of SSD pricing.

Methodology notes

• Price trackingTrendForce/DRAMeXchange contract and spot price tracking

  Use monthly contract and spot prices to determine the position of the memory industry pricing cycle

  The report compares the DRAM and NAND price data released in May with Bernstein's model, investor expectations, and prior-month quotes, with spot prices serving as one of the leading indicators for contract prices.

• Weighted averageIndustry ASP weighting model

  Estimate composite ASP changes in DRAM and NAND based on end-application weights

  DRAM weights include Mobile, Server, PC, and Specialty DRAM at about 34%, 34%, 9%, and 15%, respectively; NAND uses weights of about 40% for eMMC/UFS and about 60% for NAND wafers, while also discussing the effects of HBM and SSD.

• Supply-demand cycleMemory price cycle assessment

  Assess pricing inflection points by combining AI server demand, consumer demand destruction, LTA negotiations, and new capacity additions

  The report believes near-term shortages support price increases, but slowing consumer demand and subsequent capacity ramp-ups will gradually normalize prices from 2HCY27 to CY28.

Asset mapping & comparison

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

• SanDisk Corp (SNDK.US)

  Core covered name, with the greatest exposure to NAND prices and SSD demand

  Strengths

  Composite NAND ASP in 2QCY26 was stronger than expected, with significant increases in SSD and Mobile NAND, and the report reiterates Outperform with a $1,700 target price.

  Weaknesses

  The company's disclosures and investor communications are viewed by the report as relatively confusing, which may affect participation by high-quality investors.

  Comparison

  Compared with DRAM suppliers, SanDisk is more concentrated in exposure to the NAND cycle, offering higher elasticity but also higher structural risk.

  Risks

  Earlier-than-expected weakness in the NAND cycle, NAND softness beyond this cycle, intensifying Chinese competition, and asset value below replacement cost.

• Micron Technology Inc

  One of the main beneficiaries of rising DRAM and NAND prices

  Strengths

  The report assigns Outperform with a US$510 target price, benefiting from sharp DRAM contract price increases and strong server demand.

  Weaknesses

  Actual company ASPs may be affected by HBM, product mix, and contract structure, and may not fully match the increase in sample contract prices.

  Comparison

  Compared with SanDisk, Micron has greater exposure to the DRAM cycle; compared with Samsung and SK hynix, differences in HBM and server DRAM supply mix may lead to different ASP performance.

  Risks

  An earlier end to the favorable pricing environment, weaker demand, increased supply, and shifts in investor sentiment.

• Samsung Electronics Co Ltd

  Global DRAM and NAND supplier, affected by the memory pricing cycle

  Strengths

  The report assigns Outperform with a KRW 225,000 target price; Samsung continued pushing for higher server DRAM pricing in 2QCY26.

  Weaknesses

  The pace of some server price negotiations differs, and wafer capacity freed up by delays in the HBM4 ramp may change the supply structure.

  Comparison

  Compared with SK hynix and Micron, Samsung may be more ahead on some 2QCY26 server DRAM pricing.

  Risks

  An earlier end to the favorable pricing environment, weak demand, increased supply, and progress by Chinese memory players.

• SK hynix Inc

  A beneficiary tied to DRAM and HBM

  Strengths

  The report assigns Outperform with a KRW 1,150,000 target price, while AI and server demand continue to support pricing.

  Weaknesses

  Initial Mobile DRAM quotes are relatively more moderate than Samsung and Micron, which may affect realized pricing in some areas.

  Comparison

  Like Samsung and Micron, it benefits from DRAM price increases, but product mix and LTA terms will affect actual company ASPs.

  Risks

  An early reversal in the pricing environment, slowing demand, increased supply, and volatility in investor sentiment.

• KIOXIA Holdings Corp

  A name tied to the NAND cycle

  Strengths

  NAND pricing in 2QCY26 continues to be supported by SSD and Mobile NAND.

  Weaknesses

  The report assigns Underperform with a JPY 17,000 target price, reflecting caution on NAND structure and valuation.

  Comparison

  Like SanDisk, it is exposed to NAND, but the report takes a more cautious stance on KIOXIA.

  Risks

  Weaker NAND demand, insufficient visibility on LTAs, intensifying competition, and price normalization.

Key data

• Traditional DRAM 2QCY26 contract price increaseUp 64% versus 1QCY26May contract prices moved further higher sequentially, slightly stronger than Bernstein's current model.
• PC DRAM 2QCY26 contract price increaseUp 46% versus 1QCY26PC demand was stronger than expected, and May PC DRAM contract prices edged higher sequentially.
• Server DRAM 2QCY26 contract price increaseUp 53% versus 1QCY26Server customers continue to absorb incremental supply, with DDR5 still a key focus.
• Mobile DRAM 2QCY26 expected increaseClose to 80% QoQSamsung and Micron are asking for quotes above 80%, but increases in 2HCY26 are expected to slow to 0%-10% per quarter.
• Specialty DRAM May pricing83%-90% above 1QCY26Legacy product supply remains insufficient, and prices are still rising materially.
• Composite NAND 2QCY26 contract price increaseAbout 60% QoQThe sample average is 40%, but after considering SSD and Mobile NAND, the composite increase is estimated to be closer to 60%.
• NAND wafer May contract priceUp 1%-2% sequentiallyModule makers are more cautious about procuring at high prices, and the pace of wafer price increases continues to narrow.
• Mobile NAND 2QCY26 contract priceAbout 75%-80% QoQ increaseeSSD demand is consuming supply and driving shortages, but the risk of demand destruction is beginning to rise.
• SanDisk rating and target priceOutperform, $1,700.00Valuation is based on 11x FY26-FY29 cycle EPS, equivalent to about 8.5x FY27 EPS.

Impact & implications

For memory stocks, upward revisions to 2QCY26 prices and ASPs continue to support earnings expectations, especially benefiting memory suppliers such as SanDisk, Micron, SK hynix, and Samsung Electronics. In the short term, server and AI demand, prioritized supply for US CSPs, and LTA agreements help extend the strong pricing environment; in the medium term, consumer demand destruction, structural competition in NAND, and new capacity ramp-ups will slow the pace of price increases and limit further valuation expansion.

Risks

• The favorable pricing environment may end earlier than expected, potentially due to weaker demand or increased supply.
• Consumer demand destruction may become more evident after 3QCY26, putting downward pressure on the magnitude of DRAM and NAND price increases.
• The NAND market may face more structural competitive pressure, especially from China and YMTC-related competition.
• Reported company ASPs may differ from industry weighted price indicators due to product mix, HBM pricing, and the absence of SSD samples.
• The quality of SanDisk's disclosure and investor communication may affect valuation and investor participation.

What to watch

• Whether DRAM and NAND contract price increases in 3QCY26 slow significantly as expected.
• The scope, pricing terms, and supply assurance of LTAs signed by US CSPs, Chinese CSPs, and consumer customers.
• Whether server DRAM and AI demand can continue absorbing incremental capacity released from PC, Mobile, and delayed HBM4 ramps.
• Whether smartphone OEM production cuts and lower memory specifications expand into more visible consumer demand destruction.
• Whether SSD and eSSD demand continue to support composite NAND ASPs and offset the slowdown in NAND wafer price increases.
• After new capacity comes online from 2HCY27 to CY28, whether memory prices begin to peak and normalize.