Micron CEO says low-price push by customers fueled the memory shortage
Micron’s CEO stated that aggressive low-price demands from customers contributed to the memory shortage by discouraging investment in new production capacity. The company emphasized that sustainable pricing is necessary to avoid future supply disruptions.
Background
- Micron is one of the world's "Big Three" memory-chip makers (alongside Samsung and SK Hynix), manufacturing DRAM (computer memory) and NAND flash (storage). Its CEO is Sanjay Mehrotra.
- The memory industry has a well-known boom-bust cycle: when supply outstrips demand, prices crash; companies then cut production, which later causes shortages and price spikes.
- Mehrotra is arguing that customers (e.g., PC makers, phone makers, cloud companies) aggressively pushed for lower prices during the 2023 downturn, squeezing Micron's margins so hard that it cut investment. That under-investment, he says, is now causing the supply shortage that is driving prices back up.
- This matters because memory chips are a basic input for nearly every electronic device; shortages and higher prices ripple through the entire tech supply chain — from smartphones to AI data centers.