October DRAM contract prices hit record highs amid strong earnings

Data from DRAMeXchange, a TrendForce research arm, shows that the average contract price for mainstream DRAM products (DDR4 8Gb 1Gx8) hit $27.50 in October, up 5.77% from $26 a month earlier and a fresh all-time high. The price has climbed roughly 8.5x from the $2.90 level recorded when DRAMeXchange began tracking the segment in June 2016. Against this price surge, the third-quarter and year-to-date results of memory makers including SK Hynix, Samsung Electronics, and CXMT have drawn heavy market attention.

TrendForce forecasts that Q4 PC DRAM contract prices will rise 13%-18% from the prior quarter, while memory shipments from South Korean DRAM vendors next year are expected to fall by more than 20% versus this year. The cycle is already visible in vendor results: SK Hynix posted record third-quarter revenue of KRW 104.6 trillion and an operating profit of KRW 83.3 trillion, an operating margin of roughly 80%. The company has signed long-term agreements with 14 core customers, locking in more than half of its 2027 and 2028 capacity, and has suggested that tight supply could persist until 2030. Samsung Electronics also reported record memory revenue and operating profit for the third quarter.

Chinese memory makers are growing at a similar pace. CXMT reported first-three-quarter revenue of RMB 269.024 billion, up 738.51% year over year, and a net profit of RMB 132.04 billion, swinging from a heavy loss over the same period last year. Analysts expect the price-hike cycle to continue, with Q4 DRAM prices likely to keep rising. Institutional investors have been flocking to surveys of high-performing memory chip stocks that have lagged the broader market.