The global memory market entered a pronounced upswing from the third quarter of 2025, with spot prices for the two dominant product families — DRAM and NAND flash — rising sharply. Research house TrendForce reports that cumulative spot-price moves have exceeded 300%, and it projects further gains in early 2026: NAND flash prices are forecast to climb another 33–38% in Q1, while mainstream DRAM could rise 55–60%.
The price rally has translated quickly into corporate results. Wind data show that of 41 Chinese companies classified as storage-related, 25 had published earnings guidance by February 2; 16 of those issued positive profit warnings, with many citing an especially strong fourth quarter of 2025. Management teams across the sector point to surging demand from AI and broader compute growth as the principal driver of the improved outlook.
The mechanics behind the rally are familiar to semiconductor watchers but have been amplified this cycle. Rapid expansion in large-scale generative-AI models, higher memory densities per server and a wave of data-centre deployments have pushed capacity utilisation up. At the same time, memory fabs are capital-intensive and slow to add meaningful production; a period of under‑investment after a prolonged down-cycle left the industry vulnerable to an abrupt supply–demand imbalance once demand resumed.
For Chinese storage suppliers the timing is propitious. Many domestic firms have gained scale and process maturity in recent years, allowing them to capture higher-margin shipments as customers scramble for inventory. The earnings-season beat across multiple companies reflects both higher selling prices and inventory replenishment by customers who had previously drawn down stocks during the downturn.
That said, the upswing carries familiar risks. Memory is a cyclical business: lofty prices invite capacity expansion, which can generate oversupply and rapid price erosion when demand growth moderates. Investors and managers must also weigh geopolitics and technology strategy: while NAND and DRAM manufacturing is less exposed to some of the specific export controls that target advanced logic chips, any escalation in trade restrictions or equipment access could complicate capacity plans and plant upgrades.
For markets, the super cycle is already altering investor flows. Global memory-related equities have strengthened and semiconductor equipment orders are likely to rise as vendors seek to extend fab throughput. The medium-term outcome will depend on how quickly new capacity comes online, how sustainable AI-driven demand is, and whether product-mix improvements (such as new high-bandwidth memory variants) keep average selling prices elevated.
TrendForce's forecast for further price rises into early 2026 suggests the industry may remain in a high‑profit phase for at least several quarters. If sustained, the cycle will support stronger cash generation at memory suppliers, tighter supply for buyers and potentially a renewed wave of capital expenditure across wafer fabs and packaging lines. But history cautions that today's boom can sow the seeds of tomorrow's bust if investment overshoots demand.