Jefferies Forecasts Memory Prices to Surge 50% Quarterly, Imbalance Until 2028

Jefferies projects global memory prices will surge 40-50% in Q3 2026 and 30-40% in Q4 2026, significantly exceeding market expectations. Driven by robust AI demand and constrained supply, this upward trend is expected to continue through 2027, with supply-demand equilibrium not anticipated until 2028. Cloud service providers are securing memory with two-year contracts, pre-paying 40% and reserving 50% of capacity, potentially increasing to 70%. Jefferies estimates a 150,000-200,000 wafer per month deficit for DRAM and NAND by 2026, as global bit supply growth (excluding Chinese firms) remains limited to 7-8%. High Bandwidth Memory (HBM) demand is forecast to rise 70% in the next 12 months, with average selling prices (ASPs) potentially climbing 40-45% annually through 2027. Price declines of 15-20% are only expected in 2028, contingent on 15-20% global wafer capacity expansion and slowing AI demand.