The supply-demand imbalance in the memory chip spot market continues to intensify, and with the traditional consumer peak season approaching, Bank of America expects spot prices to have another 10% to 20% upside in September.

According to a report released by BofA Global Research on August 27, channel surveys indicate that the supply sufficiency ratio in the September spot market is below 50%, with module makers and white-box OEMs widely reporting an inability to secure sufficient quantities of general-purpose DRAM and NAND products from major memory chip manufacturers. This is because major players such as Samsung Electronics, SK Hynix, and Micron Technology are prioritizing capacity allocation for large tech customers.

The report noted that although current spot prices have pushed most IT products into negative gross margin territory, the combination of supply shortages and peak season effects will continue to drive prices higher.

This assessment is set against the backdrop of NVIDIA's latest guidance for approximately 70% revenue growth in fiscal 2027, which significantly exceeded market expectations. BofA believes this serves as a positive catalyst for memory sector investors who had turned bearish. The report also pointed out that NVIDIA's growth forecast has already incorporated memory shortage assumptions, and if demand exceeds expectations further, the memory industry could demonstrate even greater growth elasticity.

Spot Prices: Multiple Categories Hit Record Highs, Supply Gap Is the Core Driver

According to DRAMeXchange data, as of the report date, 16Gb DDR5 spot prices stood at $54, up 85% year-to-date and hitting an all-time high; 16Gb DDR4 spot prices were reported at $91, up 879% from the same period last year; and 8Gb DDR4 was at $44, up 803% year-over-year.

On the NAND front, 1Tb wafer spot prices were reported at $31.9, up 526% year-over-year; 256Gb wafers were at $16.8, up 6% week-over-week and a staggering 979% higher year-over-year.

BofA's channel survey shows the September spot market supply sufficiency ratio is below 50%, a figure that corroborates information disclosed by Samsung Electronics during its virtual roadshow — even by next year, the DRAM supply sufficiency ratio for high-end GPUs and CPUs is expected to remain only around 50% to 60%. The report emphasized that while current spot prices have already pushed most IT product margins negative, the combination of shortage conditions and peak season demand still supports 10% to 20% upside in September spot prices.

NVIDIA's FY2027 Guidance: Memory Growth Potential May Exceed 80%

BofA's report treats NVIDIA's approximately 70% revenue growth guidance for fiscal 2027 as an important catalyst for the memory industry and has accordingly raised its global DRAM sales growth forecast.

The report indicated that if one simply assumes a 10% quarter-over-quarter average selling price increase in 2027, coupled with roughly 19% shipment growth, global DRAM sales growth in 2027 could exceed 80% — significantly higher than the previously forecast 48% (ASP +24%, shipments +19%).

BofA cited three key drivers:

First, NVIDIA's own approximately 70% growth forecast is already based on memory shortage assumptions; if chip order demand proves stronger and adoption of the Rubin/Vera platforms is more widespread, the upside could expand further.

Second, the ASIC/TPU camp is more aggressively competing for HBM, DRAM, and NAND resources and is willing to pay higher prices than NVIDIA.

Third, if NVIDIA and hyperscale cloud providers absorb the new capacity from the three major memory manufacturers, Apple, Chinese OEMs, and Taiwan module makers may submit higher memory quotes for 2027 under long-term agreement frameworks, potentially driving average selling prices up more than 10% quarter-over-quarter.

Industry Roadshow: Supply Expansion Constrained, LTA Ratios Rising

BofA hosted a virtual roadshow this week covering more than 10 memory and Korean technology companies, with an overall upbeat tone.

Samsung Electronics indicated that even under long-term agreement frameworks, DRAM average selling prices remain negotiable on a quarterly basis, with approximately 60% to 70% of wafer capacity currently under LTA management; new fab capacity (P4) is primarily allocated to HBM, there is no de-specification for high-end GPU/CPU products, and next year's supply sufficiency ratio will still only be around 50% to 60%.

SK Hynix stated that although the new Yongin fab is progressing, wafer capacity expansion is constrained overall due to HBM capacity occupation, and the company has no interest in expanding traditional DRAM and NAND; even with a higher LTA ratio, near-term average selling price upside remains substantial.

Nanya Tech pointed out that traditional DDR4 demand is very strong, with new fab equipment installation expected to commence in Q1 2027, targeting an initial capacity of 30,000 wafers per month, with full production planned for 2028. Silicon Motion indicated that annualized enterprise solution revenue has doubled from approximately $1 billion a year ago to nearly $2 billion; FADU expects eSSD controller sales to grow more than 100% from the second half of 2026 through 2027.

Korean Semiconductor Exports: Record High in First 20 Days of August

According to data from Korea's Ministry of Trade, Industry and Energy, semiconductor exports reached $26 billion in the first 20 days of August, up 18% month-over-month and hitting an all-time high; year-over-year growth accelerated to 199%, marking seven consecutive months of positive growth.

As for NVIDIA, its July quarter revenue came in at $96 billion, up 106% year-over-year and 18% quarter-over-quarter; data center revenue reached $89 billion, up 117% year-over-year, accounting for as much as 93% of total revenue.

BofA's U.S. analysts expect NVIDIA's gross margin to experience modest compression as memory costs rise, but data center gross margins are expected to hold above 70%.

Memory Stock Valuations: Still Significantly Outperforming Despite July-August Pullback

Although DRAM and NAND-related stocks experienced a pullback from July to August, their year-to-date gains remain substantial.

BofA data shows that Samsung Electronics, SK Hynix, Micron Technology, and Nanya Tech share prices have all risen two to three times since the start of 2026; SanDisk and Kioxia have delivered year-to-date returns exceeding 400%.

From a valuation perspective, most DRAM stocks currently trade at price-to-earnings ratios in the 4 to 8 times range, which BofA believes is not expensive.

The report noted that SK Hynix and Samsung Electronics shares showed clear rebounds on August 27 following NVIDIA's earnings release. On the contract price front, 16Gb DDR5 and DDR4 contract prices are both in the $35 to $40 range, with August month-over-month growth narrowing to low single digits, down from 10% to 15% in July; NAND 512Gb wafer contract prices currently stand at approximately $26, up about 10 times from the February 2025 low.