TrendForce's Memory Oversupply Viewpoint Refuted: Slowing Price Growth Signals Normalcy, High Price Market to Persist Until 2027

BlockBeats News, August 12, FundaAI released a memory market analysis, explicitly refuting TrendForce's recent view that the average memory price has flattened out and will be oversupplied in the future. FundaAI believes this is a structural normalization process driven by two main factors:

First, the price sensitivity of consumer electronics, with limited tolerance for further memory price increases in end devices such as smartphones, while PC OEMs have a higher baseline price and stronger tolerance for price increases due to rigid demand in the education and commercial sectors;

Second, the continuous increase in the proportion of long-term supply agreements, with cloud service providers actively signing LTAs, locking in prices usually lower than short-term contract prices. As the LTA proportion increases, the overall price growth rate naturally slows down. However, memory manufacturers also benefit from advance payments and penalty mechanisms for breaches, enhancing revenue stability.

FundaAI interprets the current slowdown in price growth as a sign of the memory market's healthy development, rather than a precursor to oversupply in 2027 to 2028. It is expected that with further increases in the LTA proportion and a continued shift in product mix towards the data center, memory prices will remain high until 2027, instead of collapsing after peaking.