Driven by expanded investment in artificial intelligence (AI), spot prices for server DRAM are climbing sharply, far outpacing contract prices. The industry says demand for server DRAM is increasing faster than expected as AI data center construction gets underway in earnest. If the spot price strength leads to higher contract prices, expectations for improved earnings at memory chipmakers such as Samsung Electronics and SK hynix could also grow.
According to the semiconductor industry on the 23rd, the recent spot price for a 64-gigabyte (GB) server DRAM (RDIMM) topped $3,100. That is about 146% higher than the fixed transaction price of $1,380 at the end of June.
Meritz Securities said in a recent report, "Server DRAM spot prices shifted to a steep uptrend in mid-July," noting, "As sovereign AI projects in countries including Saudi Arabia move forward and test demand for new AI data centers expands, supply is so tight that even sample quantities are short."
The industry is focused on the fact that spot prices are far exceeding contract prices. Because most server DRAM is traded under long-term contracts, the spot market is used by customers who need to secure volume urgently. The surge in spot prices signals that AI projects are progressing faster than expected, and contracted volumes alone are not meeting demand.
In particular, sources say test memory demand needed in the early stage of server build-outs has surged as global big tech corporations expand AI data centers and government-led sovereign AI projects proceed simultaneously. An industry official said, "Lately, supply is so tight that even securing server DRAM for customer sample use is not easy."
The market views the latest price rise as a sign that the effects of AI investment are spreading to server DRAM following high bandwidth memory (HBM). AI servers are equipped not only with graphics processing units (GPUs) and HBM but also with high-capacity DDR5 server DRAM. After Alphabet raised its capital expenditure (CAPEX) outlook this year, Meta, Microsoft (MS), and Amazon Web Services (AWS) have also expanded AI data center investment, which analysts say is driving up server DRAM demand as well.
This is seen as a positive signal for Samsung Electronics and SK hynix. While HBM is highly profitable but limited in output, server DRAM is a core revenue source for both companies' memory businesses. The industry believes that if spot price strength leads to higher fixed transaction prices, it could translate into improved average selling prices (ASP) across the memory business.
Meritz Securities analyzed that the current trend is similar to January this year. At that time, urgent orders for AI servers poured in and server DRAM spot prices rose first. Fixed transaction prices increased starting in February.
A semiconductor industry official said, "The key is whether the rise in spot prices will carry over to fixed transaction prices," adding, "If contract prices also climb, expectations for improved memory earnings at Samsung Electronics and SK hynix could grow even further."