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The DRAM market, led by major producers Micron Technology (MU, Financials), Samsung Electronics (SSNLF, Financials), and SK Hynix (HXSCF, Financials), is set for a recovery in the latter half of 2025, according to a recent Citi Research report.
DRAM demand is likely to improve due to Apple (AAPL, Financials) and other computer hardware makers, countering worse market circumstances in the first half of the year.
Citi predicts price challenges in the PC and mobile industries through the first half of 2025, despite fourth-quarter DRAM pricing improvements. Citi believes this to be transitory, with device DRAM content rising from the second quarter. The future iPhone models, including the Pro and Pro Max, are projected to include 12GB LPDDR5T/LPDDR5X memory from the second quarter of 2025, up from 8GB. This is to facilitate AI functions.
Samsung, SK Hynix, and Micron generate 95% of DRAM revenue. Samsung has 43%, SK Hynix 35%, and Micron 20%.
Citi expects DRAM average selling prices to rise 15% in 2025. Top selection SK Hynix has a competitive advantage in premium memory categories because to its HBM3E technology and the expected introduction of HBM4 in late 2025. Citi said that these advances positioned SK Hynix well in a segmented market.
This article first appeared on GuruFocus.