Micron Technology (MU) and Sandisk (SNDK) are likely to keep benefiting as the memory sector is entering a “historic upcycle,” aided by artificial intelligence, BNP Paribas said on Wednesday.
“With consumer DRAM and NAND TLC spot prices increasing 408% and 165% Y/Y in November, respectively, we believe we are entering a historic DRAM and NAND upcycle that could span 2026,” BNP Paribas analyst Karl Ackerman wrote in a note to clients. “We continue to favor the memory and storage supply chain, though companies with high data center mix should fare better.”
Delving deeper, Ackerman said that dynamic random access memory is likely to see an average selling price boost of 35% sequentially in the fourth-quarter and 10% in the first-quarter of 2026. This is due to continued tight supply, Ackerman added, based on recent checks.
For NAND, it’s a similar situation, with prices expected to rise 15% in the fourth-quarter and 7% in the next quarter.
“Since 1999, average DRAM upcycles have spanned 8 months with [average selling prices] advancing 53% from trough to peak, while average NAND upcycles typically last 6 months with [average selling prices] advancing 40%,” Ackerman explained. “We are in the 5th month of the current DRAM upcycle with [average selling prices] up 55% and the 4th month of a NAND upcycle with ASP up 51% from trough. However, we anticipate this upcycle to be more durable for both DRAM and NAND. We are witnessing very large spot/contract spreads of 45% for DDR4, 89% for DDR5, 47% for 256Gb TLC, and 9% for 512Gb TLC, which augurs well for higher prices.”