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Gerry Chen says prices will not fall next year and supply may not catch up with demand until the second half of 2028

Tue 10 Nov 2026 · 12:09 EST · 3 min read

In Technology

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The memory chip crunch has a new forecast, and it does not come with an umbrella. Gerry Chen, CEO of Taiwanese memory maker Team Group, says the global shortage is about to get worse before it gets better.

Speaking on the company’s November 2 earnings call, Chen said the tightest stretch will run through the end of the second quarter of 2027. His remarks were reported by BigGo Finance.

“Even money can’t buy goods.”

That is a striking thing for a company to say while posting record results. It is also a warning to anyone who builds, buys, or prices hardware.

Record quarter, grim outlook

Team Group’s third-quarter numbers explain why the company can afford to be blunt. Revenue reached NT$10.14 billion, or approximately $311 million.

That figure was up 33.6% from the previous quarter. Gross margin climbed to 49.3%, and earnings per share came in at NT$37.19.

The mix of buyers has also shifted sharply. Business-to-business and AI customers made up 64.6% of total revenue, up from 24.6% a year earlier.

Chen’s outlook for 2027 offered no relief on prices. He told investors he sees no downward price trend at all next year.

He also does not expect supply and demand to balance until the second half of 2028 at the earliest.

The pricing data backs up the gloom. Contract prices for DDR5 16Gb chips rose from $8.70 in October 2025 to $48 in September 2026.

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Spot prices are even steeper, trading at a 30% to 50% premium above contract prices. Team Group itself has had to buy some memory components on the spot market at those premiums.

Why the shelves are emptying

The root cause sits upstream with the major DRAM and NAND producers. They have been steering production capacity toward high-bandwidth memory, known as HBM, and premium DDR5.

HBM is the specialized, stacked memory that sits alongside AI accelerators in data centers. Every wafer pointed at HBM is a wafer not making standard parts. As a result, output of mainstream products like DDR4 has dropped, with significant cuts expected in the coming years.

Module makers like Team Group sit in the middle of this chain. They buy chips from the big producers and assemble them into the memory sticks and drives that end up in PCs, servers, and other devices.

Team Group is responding by adding capacity. The company plans to raise production capacity by approximately 50% with a new manufacturing facility.

That expansion addresses assembly, not the underlying chip supply. A bigger factory still needs chips to put inside the modules.

What this means for buyers and investors

For investors, the split is fairly clean. Memory sellers with pricing power look positioned to benefit, as Team Group’s 49.3% gross margin suggests.

Memory buyers look exposed, especially those without long-term contracts locked in at older prices. The 30% to 50% spot premium is effectively a penalty for poor planning or bad luck.

Team Group’s revenue mix shows how much of the memory market now orbits AI infrastructure spending. B2B and AI sales constituted 64.6% of overall revenue in Q3 2026, up from 24.6% the previous year.

There is also a caveat worth keeping in mind. Team Group benefits from high prices, and a CEO forecasting scarcity is also, in a sense, describing a favorable selling environment.

The key dates to watch are the end of the second quarter of 2027, when Chen expects the worst stretch to ease, and the second half of 2028, his earliest estimate for balance. Until then, anyone buying memory should assume the price tag will not be getting friendlier.

For consumers, the practical takeaway is simple. Upgrades to RAM and storage may cost noticeably more over the next year and a half, and availability could be spotty for older standards like DDR4.

Disclosure: This article was edited by Diego Almada Lopez. For more information on how we create and review content, see our Editorial Policy.

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