Monday Signal: The Memory Supercycle and How It Ends

Thinking about the current memory supercycle, and how it ends. Three perspectives ahead;

1. Memory is building quickly toward its next glut
2. HBM contracts are moving the cycle onto customers.
3. Harnesses are taking over, reducing frontier model differentiation, and altering HBM required

1. Memory Is Building Toward Its Next Glut

What’s Happening

• Samsung and SK hynix spent KRW 43.2T on semiconductor facilities in the first half of 2026, up 35 percent.
  • Micron spent another $7.1B in its latest quarter and continues to accelerate investment.
• This is the largest supply response in memory-market history.
  • New fabs, process transitions, packaging capacity and yield improvements are all chasing the same demand forecasts.

What It Means

• The current shortage is seeding its reversal.
  • Memory prices are set by marginal availability, so even a shrinking supply deficit can sharply reduce scarcity premiums well before the market reaches outright oversupply.
• The response will arrive unevenly, then suddenly.
  • Multiple capacity, process and yield improvements will begin contributing at roughly the same time.
• Tightness may persist through early 2027, but the risk then flips.
  • The capital already committed makes a severe 2028–29 downcycle increasingly plausible.

Source: Samsung · SK hynix · Micron · TrendForce

2. HBM Contracts Are Moving the Cycle Onto Customers

What’s Happening