The memory and solid-state drive (SSD) market is witnessing a dramatic shift, with chipmakers transitioning from grappling with surplus inventory to struggling to meet burgeoning demand, largely fueled by the rise of artificial intelligence (AI).
Last year, the market was plagued by an oversupply of NAND and DRAM chips, resulting in record-low prices for SSDs and memory. However, recent reports suggest that the tide has turned, with prices for these components on an upward trajectory.
In a recent update to our SSD price guide, we found that five leading 500GB SSDs have become more expensive between January and April of this year. For instance, the Crucial MX500 saw a modest $5 increase, while the Samsung 970 Evo Plus experienced a significant $15 hike.
During Dell’s Q1 2025 earnings call, Jeff Clarke, the company’s COO, expressed his expectations for further escalations in costs, including freight and components. Clarke attributed this to insufficient capital expenditure, low factory utilization, and a limited number of wafer starts, which are likely to result in a supply shortage that won’t be able to keep up with market demand.
Dell believes that the demand will be primarily centered around powerful AI servers, which require high-bandwidth memory and swift internal and external storage. Consequently, Dell anticipates the cost of SSDs and DRAM to rise by an additional 15 to 20 percent in the second half of this year, with plans to adjust its prices accordingly to offset the impact on buyers.
The volatile nature of the DRAM and NAND chip industry has been evident for some time. In 2023, chipmakers were confronted with excess inventory, leading to record-low prices for SSDs and memory. In response, several manufacturers scaled back production in the latter half of the year to rectify the inventory issues. However, Dell’s latest warning suggests that these measures may have been overly stringent, resulting in a new challenge: insufficient supply to meet soaring demand.
