Memory Prices Jump 18% in April, Boosting Costs for Sony and Cutting Nintendo Supply
Spot DRAM prices jumped 18% in April after AI server orders doubled, pushing contract rates up 12% year-over-year. Sony forecasts a 5% production cost increase for PlayStation hardware while Nintendo warns of a 10% cut in Switch shipments this quarter due to memory shortages.
1. Memory Price Surge
High-performance DRAM spot prices climbed 18% in April as AI data center orders doubled, driving contract rates 12% higher year-over-year. NAND flash also saw a 15% uptick, reflecting tight supply and surging demand for advanced memory modules.
2. Impact on Console Makers
Sony warns that rising memory costs will increase PlayStation hardware production expenses by 5%, potentially squeezing margins on its flagship gaming consoles. Nintendo anticipates a 10% reduction in Switch shipments this quarter due to limited memory wafer availability.
3. Implications for Micron
Micron Technologies stands to gain from elevated average selling prices, with potential revenue upside of $300 million in the current quarter. However, capacity constraints may force faster capital spending on new fabs to satisfy AI-driven memory demand and protect its market share.