Samsung Electronics (OTCPK:SSNLF) increased the prices of certain memory chips, now in short supply due to the growing demand to build AI data centers, by up to 60% this month compared to September, Reuters reported, citing people familiar with the matter.
The move follows the company’s decision to delay a formal announcement of pricing for supply contracts in October, the report noted, adding that pricing details are typically announced each month.
Samsung’s contract prices for 32 gigabyte (GB) DDR5 memory chip modules jumped to $239 in November, up from $149 in September, said Tobey Gonnerman, president of semiconductor distributor Fusion Worldwide, according to the report.
DDR memory chips are used in servers, computers, and other devices.
The South Korean company also raised the prices of 16GB DDR5 and 128GB DDR5 chips by about 50% to $135 and $1,194 respectively. Prices of 64GB DDR5 and 96GB DDR5 have increased by over 30%, Gonnerman added.
The price increase was confirmed by another source who was briefed by Samsung, the report noted.
Samsung did not immediately respond to request for comment from Seeking Alpha.
The chip shortage has been so severe that it has led to panic buying by some customers, according to industry executives and analysts, the report noted.
Samsung’s slower shift to AI chips has also meant that the company has better pricing power than rivals in memory like SK hynix (OTCPK:HXSC.F) and Micron Technology (MU), as per Jeff Kim, head of research at KB Securities, the report noted.
TrendForce analyst Ellie Wang said Samsung is likely to increase quarterly contract pricing by 40% to 50% in the October-December period, higher than the average 30% expected for the wider industry, the report added.
Wang noted that the company is confident that the price is going to increase. The main reason is that the demand is strong, and everyone is working on long-term agreements with the suppliers. She added that the agreements are either for 2026 or 2026 and 2027 combined, the report noted.
Samsung also produces High-Bandwidth Memory, or HBM, chips. Compatriot SK hynix is a major supplier of HBM chips to Nvidia (NVDA). American company Micron is also a rival to the two companies in the HBM market.