Micron Technology(US:MU) Zhong Guo Jing Ying Bao·2025-10-15 07:50Core Insights - The storage industry is experiencing a significant shift from a "surplus winter" to a "shortage bull market," driven by explosive growth in artificial intelligence (AI) and increased procurement by global cloud service providers (CSPs) [1][5][7] - Major storage products, including DRAM, NAND flash, SSDs, and HDDs, are facing shortages and price increases due to heightened demand from CSPs responding to AI technology advancements [1][2][5] Market Dynamics - The current shortage is unprecedented in the storage industry, with prices for basic storage products like 1TB SATA SSDs rising nearly 30% in three months, contrasting sharply with promotional pricing just a year prior [2][3] - The storage market previously endured a five-year period of oversupply, leading to aggressive capacity expansions by major manufacturers like Samsung and Micron, which resulted in significant price declines in 2022 [2][3][7] Supply Chain Challenges - The supply chain is under pressure, with reports of significant price increases for various storage products, including a 12% rise in DDR4 DRAM prices and an 8.5% increase in DDR5 prices within a week [3][4] - Manufacturers are now cautious about expanding production capacity due to previous losses, with many opting to repair profits rather than increase output, leading to a projected 12% decline in capital expenditures for 2024 [7] Future Projections - TrendForce forecasts that DRAM prices could increase by 8% to 13% by Q4 2025, with NAND flash prices also expected to rise by 5% to 10% [4] - The global storage market is projected to approach $300 billion by 2027, driven primarily by enterprise-level AI-related capital expenditures, marking a shift from traditional consumer demand cycles [5][6] CSP and AI Influence - CSPs are expected to increase their capital expenditures significantly, with estimates suggesting a combined spending of over $420 billion by major players like Google, AWS, and Microsoft by 2025, reflecting a 61% year-on-year growth [6] - The demand from AI companies is filling the gap left by weak consumer electronics demand, with significant procurement activities disrupting existing production plans [6][7]