Direct:
Wallace Kou's specific claim on Silicon Motion's Q1 2026 call was that 2027 will be more severe than 2026 for both DRAM and NAND, that DRAM should get easier from late 2027 into 2028 as the new mega fabs ramp from the second half of 2027, and that NAND stays tight longer than that. The popular framing of this as “shortages drag into 2028” flattens it into a single bucket. The sharper read is DRAM easing while NAND doesn't.
The supply side substantiates this cleanly. TrendForce's November capex roundup pegged 2026 NAND capex at around $22.2 billion versus $21.1 billion in 2025, roughly 5% growth, with Samsung and SK Hynix actively limiting NAND investment to shift wafers toward HBM and DRAM. Micron's NAND capex is up 63% year over year, but TrendForce frames that as a modest capacity bump focused on G9 process development and enterprise SSDs rather than a real wafer-out expansion, and the ID1 fab in Idaho isn't operational before 2027. The only aggressive NAND capacity push from players without DRAM tradeoffs is Kioxia/SanDisk, with a 41% capex bump to $4.5 billion targeting BiCS8 and BiCS9, and YMTC. That's the entire structural NAND supply response, and it's modest.
Demand is doing the opposite. 2026 NAND allocations are reportedly already sold out, with hyperscalers said to be negotiating 2027 allocations directly with Samsung, SK Hynix, and Kioxia. Silicon Motion itself benefits structurally from this. Kou noted on the Q4 call that two NAND makers have exited the mobile storage business, pushing module makers toward independent controllers, and on the Q1 call that MonTitan Gen5 and upcoming Gen6 controllers already have Tier 1 design wins with both NAND makers and cloud service providers, with ramp from late 2026 through 2028. The shortage is good for the controller business.
What it means for consumer SSDs: the DRAM side relaxing in 2028 helps client drives that need DRAM caches, but the NAND side staying tight means MSRPs don't snap back. Kou's own Q4 commentary was that DRAM-less four-channel PCIe 5.0 demand is expected to be stronger, particularly in the second half of 2026, with 8-channel adoption slowed by DRAM shortages. Translation: the cheap DRAM-less drives become the volume part for longer than anyone expected, and the premium 8-channel tier stays expensive. If you've been waiting for 4TB Gen 5 pricing to crater, you'll be waiting a while.
DRAM gets daylight late 2027 through 2028. NAND doesn't.
Sources:
- Silicon Motion Q1 2026 earnings transcript (late April 2026)
- Silicon Motion Q4 2025 earnings transcripts and call highlights (February and April 2026)
- TrendForce, “Memory Industry to Maintain Cautious CapEx in 2026” (November 2025)
- TrendForce, “NAND Flash Prices Likely to Jump Double Digits in Q1” (November 2025)
- DigiTimes, “Silicon Motion warns AI-driven NAND shortages will deepen in 2027” (April 2026)
- PC Gamer coverage of Kou's prior shortage commentary (November–December 2025)
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