DRAM shortage to last through 2028: Nanya

Nanya Technology Corp (南亞科技) yesterday said the DRAM supply crunch could extend through 2028, as the artificial intelligence (AI) boom has led the world’s major memory makers to dramatically reduce production of standard DRAM and allocate a significant portion of their capacity for high-bandwidth memory (HBM) chips.The most severe supply constraints would stretch to the first half of next year due to “very limited” increases in new DRAM capacity worldwide, Nanya Technology president Lee Pei-ing (李培瑛) told a news briefing. The company plans to increase monthly 12-inch wafer capacity to 20,000 in the first half of 2028, Lee said, adding that he expects more capacity from global memory suppliers would become available in the second half of 2028. “As the disparity in supply and demand is enormous, it is not clear if such capacity increase would be sufficient to fill the gap,” Lee said. Nanya Technology said it expects HBM chips to account for 10 percent of the world’s total DRAM output this year, up from 7 percent last year and 4 percent in 2024. It said it plans to spend NT$52 billion (US$1.64 billion) on capital expenditure this year to expedite the construction of a new plant in New Taipei City’s Taishan District (泰山). Nanya Technology said it plans to utilize its 1B technology, or its second generation of 10-class nanometer technology, to produce DDR5, DDR4 and low-power DDR4 memory chips at the plant. The new plant would have a maximum capacity of 45,000 wafers per month, the company said. It said it would not rule out the possibility of rolling out a new capacity expansion plan, if market demand remains strong. The US-Iran war would have minimal impact on the company’s revenue performance, given its revenue exposure of less than 1 percent to the Middle East, Lee said. Europe, the Middle East and Africa altogether contributed about 5 percent to the company’s revenue, he said. Nanya Technology also expects limited impact from Chinese rivals, if the US lifts restrictions on companies from using China-made chips as recent reports suggested, as product certifications would still take time, Lee said. The company expects DRAM prices to rise further in the second quarter and the uptrend is to sustain through the end of this year, he said.