Morgan Stanley: China Semiconductors — Old Memory: How to Think About DDR4 Price Hikes in 2Q26
Summaries are public. PDF access requires an active membership; all members have the same access. Sign in
Morgan Stanley recently published an update examining the trajectory of DDR4 pricing ahead of the second quarter of 2026. The report follows a significant market drawdown where legacy memory stocks underperformed, with Winbond falling 5.2%, Nanya Technology dropping 9.9%, PSMC declining 7.6%, and Macronix losing 10.0%. Beyond broader geopolitical headwinds, investors are increasingly concerned that the pace of DDR4 price increases may decelerate.
Following softer notebook and graphics demand after the Lunar New Year, analysts now expect Korean suppliers may slow their capacity reallocation from legacy DDR4 nodes to GDDR7. A reassessment of the supply-demand model indicates that if Korean suppliers maintain their first-quarter DDR4 capacity levels through the second quarter, the supply shortfall would narrow from 28% to 20%. This compression implies a more modest price hike from Korean suppliers during the period. However, the industry-wide migration toward leading-edge DDR5 processes is expected to continue unabated, supported by robust server demand. Morgan Stanley views the DDR4 slowdown as a temporary disruption rather than a structural shift, maintaining an Attractive rating on the sector with continued upside potential for cloud semiconductor shipments and margins.