Something else that they agree on is that OEMs, at least for now, are absorbing the increasing price and not passing it on to customers. However, that’s subject to change if the prices keep going up.
“To date, we’ve not heard various vendors talking about increasing prices, but we’ve not seen those price increases hit yet, because most of the systems that are shipped into the channel and that are selling right now were shipped before the dramatic price increases hit,” said Mainelli.
“What’s likely to happen, from a market perspective, is we’ll see the market grow less in 26 than we had anticipated but ASPs are likely to stay or increase. So revenues overall may not look too bad, but from a unit volume that’s likely going to be impacted as prices go up,” he said.
Finally, they agree that if the often-rumored AI bubble bursting actually happens and construction comes to a stop? If expansion stops, demand will stop and that will free up supply, argue the analysts.
“If you decide that you’re going to spend before you have the demand [for AI], then you bet that there’s going to be a lot of AI demand, so you end up increasing your capex as a percent of revenue. And that’s what these guys are doing. If investors complain because it is going to impact what their return is to investors, then eventually they’ll take their foot off the gas, and then that will cause prices to the collapse,” said Handy.
“We’ll be watching very closely to look at all the hyperscalers and others that are building and leveraging all this RAM connecting it to all these GPUs in the data center, to see if there’s any indication they might slow down. If they were to slow down, then the memory situation could clear up relatively quickly, but right now, in mid-January, there’s not really any indication of that happening,” said Mainelli.
