Jefferies Warns Memory Prices Will Surge 50% in Q3 2026 and Another 40% in Q4, With No Relief Until 2028

Key Points:

• Memory prices are expected to rise sharply in 2026, with forecasts indicating a 40-50% increase in Q3 followed by another 30-40% hike in Q4, driven by ongoing global supply shortages and strong AI-related demand.
• Long-term contracts between major memory makers and top tech firms currently cover about 50% of total capacity, potentially rising to 70%, limiting supply for consumer electronics and pushing prices higher for PCs, laptops, consoles, and smartphones.
• Chinese memory manufacturers, including CXMT and YMTC, are not expected to disrupt the market or provide price relief in 2026-2027, as their supply is primarily for domestic use; however, significant expansion planned for 2028 could change this dynamic.
• A potential price decline is anticipated in 2028 due to 15-20% new supply capacity coming online, but this may be offset by continued strong demand driven by AI and compute needs.
• Industry analysts highlight that process node migration and the dominance of cloud service providers in long-term agreements are reshaping supply allocation, contributing to the sustained price escalation through 2027.