Samsung Electronics to raise prices of memory semiconductors by up to 60% as AI demand surges - South Korean media

Samsung Electronics has reportedly raised the price of server memory chips by as much as 60% amid a shortage of memory semiconductor supplies due to the global race to invest in AI data centers.
Reuters reported on the 14th (local time) that Samsung Electronics has raised contract prices for some memory products by up to 60% this month compared to September, citing multiple sources.
This decision was reportedly made after Samsung Electronics delayed the announcement of its supply contract prices by about a month in October and adjusted the amount of the price increase. Samsung Electronics usually sets monthly supply prices.
Samsung Electronics' 32GB DDR5 memory, according to semiconductor distributor Fusion Worldwide, is expected to be the first to announce its price in the first half of 2021.
The price of a chip module rose by about 60%, from $149 in September to $239 in November.
The contract prices of DDR5 memory chips from NVIDIA are also trading at the US$135 (approximately JPY 20,800) and US$1,194 (approximately JPY 184,000), respectively, up about 50%, with 64GB RAM being the most expensive.
Contract prices for 16GB and 96GB DDR5 memory chips also increased by more than 30 percent. Fusion Worldwide president Toby Gonnerman told Reuters:
"Large server manufacturers and data center companies are unable to secure sufficient quantities," he said, adding, "They are willing to pay an extreme premium to get their hands on the products."
Reuters reported that an industry insider said, "The memory shortage is becoming more serious, with some customers resorting to panic buying."
Some analysts say the recent surge in memory prices is a positive factor for Samsung Electronics.
This is because, while rising chip prices are increasing the cost burden on global IT infrastructure companies, Samsung Electronics' profitability is likely to improve.
Reuters reported that Samsung Electronics has lagged behind SK Hynix and the US's Micron in the area of high-performance AI chips, but
In the memory sector, Samsung has maintained its leadership in supply and has actually gained more bargaining power on prices, according to industry analysts.
"Electronics is expected to raise contract prices for the fourth quarter of this year by 40 to 50 percent compared to the previous quarter," he said, adding, "This is expected to far exceed the industry average increase rate (30 percent)."
He added, "Demand is currently so high that major customers have signed long-term supply contracts until 2026 or 2027," and added, "Samsung Electronics is very confident about raising prices."
Reuters also reported that the surge in chip prices could increase the costs for big tech companies building data centers.
Not only memory for AI servers, but also DDR products used in smartphones and PCs are facing a chain reaction of rising prices.
"The price surge has significantly increased the cost of manufacturing smartphones," China's largest foundry, SMIC, said, adding that "the memory shortage has caused customers to put orders for other chips on hold."
"There are," he said.