Goldman Sachs Storage Expert Meeting: Capacity Expansion “A Distant Solution to Immediate Needs”, DRAM Price Increases May Continue Until 2028, HBM Average Price Expected to Soar 122% Next Year

The supply and demand structure of the storage chip market is tilting towards leading manufacturers, and the price increase cycle may last longer than the market expects.

Goldman Sachs held a TrendForce memory industry expert webinar on October 27. According to experts from TrendForce, DRAM supply will remain tight throughout 2027, with the price upcycle likely to extend into the first half of 2028. The average hybrid HBM price is expected to surge by 122% year-on-year to $3.7 per GB in 2027, driving HBM industry revenues up by over 230% and breaking through $200 billion.

Capacity expansion faces structural constraints such as insufficient cleanroom space and extended equipment delivery lead times. TrendForce believes that it will be difficult to achieve effective supply growth before 2028, and this bottleneck will provide ongoing support for rising prices. Meanwhile, the competitive threat from Chinese HBM suppliers is limited in the short term, with their combined market share expected to be less than 2% by 2027.

TrendForce forecasts that, with server demand remaining robust and supply growth constrained, DRAM average prices will continue to rise over the next several quarters, although relatively weak consumer demand may act as a certain drag.

Long-term agreement (LTA) coverage has reached 60% to 70%, which may moderate price increases in 2027. However, TrendForce points out that incremental demand beyond contracted volumes can still be negotiated at higher prices, so overall pricing remains upward biased. Taking all factors into account, TrendForce currently expects DRAM prices to keep rising until the first half of 2028.

TrendForce expects that the blended average HBM price will increase by 122% year-on-year to $3.7 per GB in 2027, driving HBM industry revenues up by over 230%, surpassing $200 billion.

Price differentiation will be significant. According to TrendForce, high-end HBM4 may be priced above $5 per GB, while low-end products will be close to $3 per GB, resulting in marked negotiation differences between suppliers and customers. 8-layer stacked HBM4 chips have higher unit base chip costs, and are expected to carry a 5% to 10% per-bit premium over 12-layer stacked products. HBM4E pricing may also be substantially higher than HBM4.

Goldman Sachs noted in its report that these views are generally consistent with its own forecasts—the bank currently estimates that the main suppliers’ HBM average prices will increase 100% to 160% year-on-year next year.

Despite aggressive capital expenditure plans by leading manufacturers, TrendForce still believes it will be difficult to achieve effective DRAM capacity increases before 2028, mainly due to insufficient cleanroom space and long semiconductor equipment delivery lead times.

TrendForce predicts that each Korean manufacturer can add 80,000 to 100,000 wafer starts per month (WPM) in 2027. However, the majority of Samsung Electronics' new capacity is expected to be allocated to HBM, with traditional DRAM bit growth mainly driven by process migration. The equipment supply situation is expected to gradually improve from the second half of 2027, but new fabs are not expected to make a substantial contribution to supply until 2028. At the same time, TrendForce notes that suppliers may also proactively adjust the pace of capacity expansion according to demand outlook.

TrendForce also pointed out that Google is becoming a major driver of HBM demand growth. With the increasing deployment of TPUs in Google data centers, HBM3E bit demand is expected to be supported next year, meaning that HBM demand will be spread across generations rather than concentrated in HBM4 and HBM4E.

Meanwhile, because of the significant pricing premium for HBM4, TrendForce expects HBM4 to account for nearly 60% of HBM industry revenue in 2027.

TrendForce believes that, despite continuous capacity and technology investments by Chinese memory manufacturers, there is still a considerable gap with leading suppliers in terms of technical capabilities and yield, so the competitive risk to the global HBM market remains limited in the short term.

Goldman Sachs reiterated its "Buy" rating for both common and preferred shares of Samsung Electronics, with 12-month target prices of 500,000 KRW and 380,000 KRW, respectively. The valuation is based on a sum-of-the-parts (SOTP) method calculated with expected EV/EBITDA for 2026–2027.

The target price for SK Hynix is 3.5 million KRW, based on the average expected P/E for 2026–2027, corresponding to a target valuation multiple of 9.0. The Buy rating is also maintained.