DDR4 Price Rises After Manufacturers Shift Production Focus to AI-Application Hardware
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Key points
- Samsung, SK Hynix, and Micron are shifting production focuses to newer DDR5 and high-bandwidth memory.
- The demand for DDR4 and limited supply have caused an increase in price for the older generation of technology.
- Some cases of DDR4 show a higher price than DDR5.
DDR4 prices are spiking after hardware manufacturers Samsung, SK Hynix, and Micron shifted their production focus towards the newer DDR5 and high-bandwidth memory (HBM). These newer generation hardware are used for AI applications, resulting in reduced supply of DDR4. The consistent demand for DDR4 and reduced supply are attributed to the increase in price for the older generation hardware.
Some older DDR4 kits are reportedly more expensive than their newer DDR5 counterparts, with Digitimes reporting DDR4 16GB having increased nearly 7% in August, reaching $9.17 each, while DDR5 16GB chips experienced a 3% decrease, falling to $5.99. This has resulted in DDR4 now being almost 50% more expensive than DDR5.
The price of DDR4 8GB chips continued to drop. Meanwhile, DDR3 memory saw another sharp price surge, jumping 13% after a 20% rally in July. This was primarily driven by panic buying, following the news of Samsung’s planned exit from DDR3 production and limited output from Taiwanese manufacturers.
Analysts believe that the price increase is attributed more to “supply being deliberately throttled than demand suddenly spiking” than to the increase in demand. The prices are expected to continue to increase through the year-end, with DDR4 demands projected to rebound in September when inventory digestion concludes.
