Micron warns: memory shortage will persist at least until 2028

At its earnings call for fiscal 2026, Micron warned that the RAM shortage will persist at least until 2028. Company CEO Sanjay Mehrotra said demand will exceed supply in both 2027 and 2028, and that the pressure on the market is only growing.

The company has already sold in advance most of the memory it will produce next year. According to Mehrotra, buyers will pay noticeably more than this year. The company has no clarity on when supply and demand will return to balance.

Micron plans to bring new plants online in 2028, and capital spending in the first half of the new fiscal year will amount to $25 billion. Management warned that this capacity will not improve availability or lower prices right away.

Record earnings

The earnings figures show the scale of the moment. Quarterly revenue rose to $54.25 billion from $11.3 billion a year earlier, and annual revenue to $133.2 billion from $37.4 billion. Net profit climbed 895% to reach $85 billion. Gross margin for the cloud memory division, which handles HBM, rose from 59% to 83%, and for the main data-center DRAM business from 41% to 90%. Data-center SSD sales for the quarter came to almost $10 billion, up more than 1,000% year over year.

Demand for HBM for AI accelerators is growing faster than for standard server DRAM. Micron is working with NVIDIA on a custom HBM4E implementation called NV-HBM for the next generation of GPUs and NVLink fusion platforms. The SSD market is expanding too, including for KV-cache offload workloads.

Plans and guidance

For the first quarter of fiscal 2027, Micron expects revenue of $61.5 billion, plus or minus $1.5 billion, and a gross margin of 86.25%. After the release, the company's shares jumped but then returned to their closing price: judging by the reaction, investors had expected such growth.

For buyers this means one simple thing: RAM and SSDs will not get cheaper in the coming years. The company does not specify how much the price increase will affect retail.

Image: Micron Technology CC BY-SA 4.0 · License

Translation editors: Соловьев В., Пеков А.