I’ve been seeing more discussion around Micron and AI driven memory demand lately, especially tied to data centers and high performance computing. The argument seems to be that AI workloads are creating a more durable source of demand for DRAM and advanced memory, which could make this cycle different from past ones.
At the same time, memory has always been a highly cyclical industry. Supply discipline can look strong during upcycles, but history shows that capacity eventually catches up, pricing rolls over, and margins compress. Even with AI as a tailwind, it’s not obvious that the basic supply demand dynamics have fundamentally changed.
What I’m trying to figure out is whether AI demand truly smooths out the cycle or simply makes the peaks higher and the optimism stronger during upswings. If AI infrastructure spending stays elevated for years, memory could behave more like a secular growth input. If not, this could still be a familiar boom and bust with better headlines.
Curious how others here think about it from a longer term investing perspective rather than a short term trade.
Not financial advice.
Is AI demand changing the memory cycle or just amplifying it
byu/Certain_Pa5045 ininvesting
Posted by Certain_Pa5045
4 Comments
The interesting part to me is whether data center demand stays steady enough to smooth out pricing over time
Feels like AI helps demand but memory still looks cyclical to me
What are the financials of AI demand? Seems that there’s a ton of borrowing for expected AI demand, even as the cost of using an AI cloud server is $1 to $3 an hour. The question I always ask is would you pay $20/month for AI? Our son’s workplace pays a chunk of change to OpenAI and Microsoft for AI services but they make considerable use of it to make their employees more productive and their employees embrace it (or lose their jobs as they aren’t competitive).
My example: bought a PC upgrade for $500 this summer. Ryzen 9 9900X, MSI Tomawark X870E, 32 GB G-Skill DDR5. Price this morning is $1,059. Also bought a 4 TB Crucial Gen 4 NVMe SSD for $219.99. Price this morning is $499.99.
One thing that the RAM and SSD prices is having an effect is on consumer gaming PCs. People are holding onto their older gear and even shopping for older gear that uses older RAM that may cost less or they are looking on the used market for systems that they can take the RAM and SSD out of.
We bought 32 GB of Corsair Vengeance DDR4 in 2019 for $150. The price on the used market is $306 for it today. That’s truly insane.
That’s a good question. I’d argue that AI is amplifying the memory cycle rather than fundamentally transforming it. While AI demand for HBM and DRAM does create structural growth, memory remains fundamentally a cyclical industry. Capital expenditures, supply rhythms, and macroeconomic conditions remain the key drivers. The difference is that during periods of strong AI investment, the upward momentum can be more intense and sustained.