Citrini Analyst: The AI Era May Change Storage Cycle Logic, Chip Stock Declines Don't Necessarily Mean Industry Collapse

Odaily Odaily News Citrini analyst Jukan pointed out in an analysis that the recent decline in memory chip stocks may not only be due to the unwinding of leveraged positions, but also suggests that the market could be pricing in the pressure from future supply expansion in advance. Even if the global memory shortage persists until 2027, most research institutions and industry observers still expect supply-demand tensions to begin easing in 2028. As memory manufacturers like Samsung Electronics and SK Hynix announce large-scale wafer fab expansion plans, the market may have already started to reflect the impact of new capacity coming online after 2028.

There is a common rule in the traditional memory industry: memory stock prices typically peak about two quarters ahead of memory prices. However, in the new cycle driven by AI, could the market be pricing future supply-demand changes much earlier, such as three or even four quarters in advance? The AI era may bring new dynamics, and the traditional logic of "price drops leading to revenue declines" in the memory cycle may not fully apply to the AI infrastructure market.

Jukan noted that the key difference is that in the AI era, "demand growth driven by price declines" could buffer the downturn impact of the memory price cycle. If this logic holds, the future earnings volatility of memory companies could be lower than in past cycles, potentially supporting higher valuation levels.