The three companies that dominate the world’s memory chip supply, SK Hynix, Micron Technology, and Samsung Electronics, are sitting on one of the hottest trades in semiconductors. AI has turned their products into liquid gold, with Micron’s shares soaring over 296% on the back of surging demand for AI-related memory.
A history written in red ink
For decades, the industry has followed a grimly predictable pattern: booms lasting roughly 4 to 7 quarters, followed by busts stretching 4 to 8 quarters. During the downturns, revenues typically crater by 25-40%, and stock prices get cut in half or worse, with declines of 50-60% being entirely normal.
The mechanics are almost boringly simple. When prices rise, chipmakers rush to build new fabrication plants. By the time those fabs come online, demand has cooled, supply floods the market, and prices collapse. Rinse, repeat, for about three decades straight.
What makes the current moment different, at least on paper, is consolidation. The number of significant DRAM manufacturers has shrunk from over 20 in the early 1990s to just three today.
