Samsung Electronics and SK Hynix are accelerating the expansion of high-bandwidth memory (HBM) production, but supply shortages are expected to continue into next year. Industry analysts predict that the average selling price (ASP) of HBM will more than double compared to this year, driven by rapidly increasing demand for HBM in AI accelerators before new production lines come online.
According to market research firm TrendForce, the mixed average selling price of HBM is projected to rise by 121% next year. This increase is attributed to supply shortages and a higher proportion of premium products like HBM4. Shipments of HBM4E are expected to begin in the second half of next year. However, this does not mean that the prices of the same HBM products will uniformly increase by 2.2 times, as the product mix will change.
The ongoing price negotiations this year will have a direct impact on performance. Unlike general DRAM, HBM prices and volumes are often set annually with major customers. Negotiations for HBM4 shipments scheduled for 2027 reportedly began in earnest in the second quarter of this year. SK Hynix also stated during a conference call in July that it is discussing next year's supply volumes and prices with key customers. The industry believes that a significant portion of the anticipated price increases will be reflected in contracts signed this year for shipments next year.
Both Samsung and SK Hynix are simultaneously ramping up their production capabilities. Samsung is expanding its production capacity for HBM4 at its P4 facility in Pyeongtaek, aiming to secure a monthly output of 100,000 to 120,000 wafers by the first quarter of next year. Discussions are underway to expedite the installation of P5 equipment, but significant contributions to supply are not expected until after 2028. In Onyang and Cheonan, HBM packaging facilities are also being expanded.
SK Hynix is accelerating its HBM production expansion schedule at its M15X facility in Cheongju and has increased its capital investment to the upper 40 trillion won range. The Y1 plant, the first in the Yongin cluster, is set to begin production preparations gradually next year, with 35.2 trillion won allocated for the Y2 plant. Additionally, a 19 trillion won P&T7 facility is under construction in Cheongju to handle HBM backend processes.
Despite the large-scale investments, an immediate increase in supply is not guaranteed. New production lines require equipment installation and process stabilization. HBM production demands more wafers and advanced packaging processes than standard DRAM. TrendForce reports that the share of HBM in total DRAM wafer input has risen from 18% at the end of last year to 22% this year, and is expected to reach 30% next year. As HBM production increases, the supply capacity for general DRAM may decrease, tightening the overall memory supply.
Consequently, analysts suggest that the performance of Samsung and SK Hynix next year will depend not only on shipment volumes but also on the terms of contracts signed this year. SK Hynix has already established long-term supply agreements with about ten major customers. Samsung is also pushing to expand HBM4 supply. However, the projected 121% increase in mixed average selling price cannot be directly equated with the profit growth rates of the two companies, as factors such as customer-specific contract prices, the proportion of HBM4, and initial yields from new lines will play a role.
Industry insiders are noting that even amid expansion, price forecasts are rising. Typically, large-scale expansions in the memory industry lead to increased supply and falling prices, but current HBM investments are primarily aimed at keeping pace with growing demand.
One industry official stated, "There is a time lag before expanded production translates into actual supply, so tight supply conditions are expected to continue for the time being. The terms of contracts signed this year will be a key variable for next year's performance."
* This article has been translated by AI.
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