Samsung CEO warns AI memory chip shortage will last years

Samsung Southwest Asia President and CEO JB Park warned that the global memory chip shortage fueled by artificial intelligence demand will persist for years, as the industry struggles to expand production capacity fast enough to meet surging requirements.

Supply-Demand Gap "Beyond Everyone's Expectations"

Speaking to CNBC-TV18, Park said the adoption of AI is driving computing power requirements that continue to outstrip memory supply. "I think this will continue into the second half, and while the industry is ramping up production, it will take a couple of years for supply to become sufficient. Until then, I think the memory crisis will continue," he said.cnbctv18

Park told evo India that Samsung has absorbed substantial memory component cost increases over the past eight months rather than passing them to consumers, describing the financial impact as "humongous". The remarks come as Samsung posted preliminary second-quarter operating profit of 89.4 trillion won ($58.4 billion), a record driven largely by soaring memory chip prices. Reuters reported that analysts expect the memory market to remain undersupplied at least through next year.Reuters+2

Galaxy AI: Free for Most, Paid for Pros

In a separate roundtable ahead of the Galaxy Fold8 Series launch, Park outlined Samsung's evolving AI monetization strategy. He told The Mobile Indian that Samsung operates a "hybrid style of AI" combining on-device intelligence with cloud-based partner services, and that professional users seeking advanced capabilities would pay subscription fees.themobileindian

"If you are an engineer or an architect who uses or benefits from using a pro-level AI, you will have to pay a monthly subscription on this partner cloud-based AI platform, but that's for professional users unlike common consumers," Park said. He added that basic Galaxy AI features would remain free for the roughly 90 percent of users who rely on them, while a paid "pro level" tier could emerge for specialized editing and other advanced tools.themobileindian

Industry Bracing for Extended Tightness

South Korea announced plans in July for Samsung and SK Hynix to invest approximately $516 billion in four new memory fabrication plants, but most projects will not deliver supply until 2027 at the earliest. Deutsche Bank expects DRAM to remain tight beyond 2028. Micron ↗ 11.89%, the third major memory producer, faces similar constraints as manufacturers shift capacity toward high-bandwidth memory for AI data centers at the expense of conventional DRAM supply.networkworld+1