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SK Hynix says memory demand is expected to exceed supply for several years, with shortages potentially continuing through 2030. The company reported record third-quarter 2026 revenue and plans to expand advanced DRAM, HBM4 and NAND production, while long-term agreements already cover more than half of its production capacity for 2027 and 2028.
SK Hynix expects memory demand to outstrip supply through 2030, even as it expands production of advanced DRAM, HBM4 and NAND, according to its third-quarter 2026 results announcement. The forecast highlights the difficulty of scaling production quickly enough to meet demand from AI data centers and other high-performance computing customers.
SK Hynix reported quarterly revenue of 104.6155 trillion won (about $78.1 billion) and operating profit of 83.3338 trillion won (about $62.2 billion). The company said revenue rose 32% from the previous quarter, while operating profit increased 38%. Revenue passed 100 trillion won for the first time in the company’s history, according to the announcement.
The company attributed the results to strong demand for server DDR5 and HBM4, alongside sales of its 321-layer TLC enterprise solid-state drive. SK Hynix plans to increase output of its sixth-generation, 10-nanometer-class 1c DRAM, which it uses for products including DDR5 and LPDDR5 SOCAMM. It also plans to bring its M15X facility to maximum capacity to support higher HBM production.
SK Hynix expects HBM4 to exceed HBM3E in both shipment volume and revenue in the fourth quarter of 2026, as HBM4 becomes a mainstream product. For NAND, it plans to lift production of its 321-layer process so that it accounts for more than half of domestic NAND capacity in that quarter. The company also identified HBF technology as a planned NAND solution for increasing AI throughput.
AI Demand Outruns New Memory Capacity
The forecast points to a prolonged supply constraint for a component central to AI servers and data centers. If customer demand continues to exceed available memory, buyers may face tighter access to high-bandwidth memory and other advanced products, while manufacturers have an incentive to commit capacity well ahead of delivery. SK Hynix’s forecast is a company outlook, not a guarantee that shortages will continue for a set period or affect every type of memory equally.
The pressure also matters for the wider technology supply chain. AI infrastructure depends on memory as well as processors and accelerators, and limited availability can affect how quickly customers build or expand systems. SK Hynix’s plans to add capacity could increase supply over time, but the company says that the complexity of leading-edge production and the time required to build facilities limit how quickly output can respond.
For SK Hynix, long-term customer agreements offer a way to plan investment against expected demand. The company said agreements with 14 major customers, including global cloud service providers, cover more than 50% of its total production capacity for 2027 and 2028. That gives it greater demand visibility, although it does not establish how much memory will be available to customers outside those contracts.
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Expansion Plans and Customer Contracts
SK Hynix said it plans to expand production in response to demand across its DRAM and NAND businesses. The near-term effort includes increasing the share of 1c DRAM and maximizing M15X capacity for HBM. The company also said the Yongin Phase 1 facility is expected to enter full-scale operation next year, alongside increased domestic and overseas infrastructure investment.
The company has not described investment as unlimited or fixed. It said it will adjust the scale and timing of spending based on customer demand, product competitiveness, profitability and investment efficiency. That qualification matters because construction and equipment spending must be weighed against the risk that demand or market conditions change before new capacity comes online.
SK Hynix said it has signed long-term agreements with 14 major customers and is discussing possible extensions with other customers. The agreements are typically five years, according to the company. It said the contracts use a price range agreed with customers that reflects market conditions, rather than a single fixed price, to give it some flexibility as prices change.
“Demand will exceed supply for the next several years.”
— SK Hynix
How Quickly Supply Can Catch Up
The forecast does not specify the size of the expected shortfall in each year through 2030, or how shortages may differ across DRAM, HBM and NAND. It is also unclear how much new capacity will come online on schedule, how quickly production yields will develop, or how demand for AI infrastructure will change. SK Hynix’s outlook reflects its current assessment and could shift as market conditions evolve.
The company cited more than 50% of total production capacity for 2027 and 2028 as covered by long-term agreements, but did not provide a detailed breakdown by product or customer. The announcement also does not show what share of future capacity remains available for short-term purchases or other buyers. The price-range mechanism was described in general terms; specific contract prices and conditions were not disclosed.
Capacity Ramps and 2027 Operations
Near-term milestones include the planned increase in HBM4 output and the ramp-up of 321-layer NAND in the fourth quarter of 2026. SK Hynix expects HBM4 shipments and revenue to surpass HBM3E in that quarter, according to its forecast. The company will also move toward full-scale operation at Yongin Phase 1 next year while evaluating further investment against demand and returns.
Customers and competitors will be watching whether those additions ease constraints or whether AI-related demand continues to absorb new output. SK Hynix’s subsequent results and production updates should provide more detail on capacity, customer commitments and the pace of its investment. For now, its stated outlook is that supply will remain tight for years, with shortages potentially lasting through 2030.
Key Questions
How long does SK Hynix expect memory shortages to last?
SK Hynix expects memory supply shortages to persist through 2030, based on its current assessment that demand will exceed supply for several years.
What is driving the expected shortfall?
The company points to strong demand for memory used in AI data centers, including HBM and server DRAM, alongside the technical complexity and long construction timelines involved in adding advanced production capacity.
What products is SK Hynix increasing production of?
Its plans include more 1c DRAM, increased HBM production through the M15X facility, and higher output of 321-layer NAND. The company expects HBM4 to surpass HBM3E in shipments and revenue in the fourth quarter of 2026.
How much of SK Hynix’s future capacity is under long-term agreements?
SK Hynix said agreements with 14 major customers cover more than 50% of its total production capacity for 2027 and 2028. It did not disclose a product-by-product breakdown.
Does the forecast mean every type of memory will be in shortage until 2030?
No. The company gave an overall supply outlook, but did not provide annual shortage estimates by memory type. The scale and duration of constraints could vary across products and change with demand and production growth.
Source: Wccftech
