Svmuu News: Industry insiders note that historically, whenever the memory chip industry experiences a boom, manufacturers tend to expand production capacity simultaneously. This leads to a concentrated release of new capacity and a sharp drop in prices, plunging the entire industry into losses. Subsequently, manufacturers collectively scale back capital expenditures, and when demand rebounds, another boom follows—this cycle constitutes the industry’s unique cyclical nature.
Since hitting their peak in late June, U.S. memory chip stocks have experienced a collective pullback as news—such as Meta’s sale of computing power—sparked market concerns about an oversupply of computing power.Data shows that industry leaders such as SanDisk, Micron, Seagate Technology, and Western Digital have all seen their stock prices fall by more than 20% over the past few weeks.
Analysts point out that the underlying logic currently supporting memory chip demand is facing a reassessment, with the key variable being whether the technological gap between various large AI models will continue to narrow.
Analysts also point out that the memory chip industry is undergoing a profound shift in its business model: in the past, memory was treated more like a commodity, with prices following market trends and contracts typically based on quarterly or annual terms;now, to secure critical supplies, cloud service providers and AI data centers are increasingly signing long-term supply agreements with original equipment manufacturers (OEMs) spanning three to five years, which include price ranges, minimum purchase volumes, and customer performance bonds. (CCTV Finance)