Every so often the unglamorous part of the computer says something the glamorous parts would rather not hear. Seagate has just done it. Ban-Seng Teh, the company's chief commercial officer, told the South China Morning Post that memory price rises are likely to become "the new normal" for the next few years, and that the artificial intelligence boom has pushed the industry into what he described as a supercycle.
A supercycle is less a technical term than an admission. Memory has always moved in cycles of shortage and glut, roughly the way a crop does: a bad year sends prices up, everyone plants more, and two seasons later nobody can give the stuff away. Teh's argument is that this one refuses to behave. "It’s hard to tell if it will last forever," he said, calling the current cycle "very unusual because in the past we went through cycles of shortage and oversupply".
Seagate mostly sells hard drives, which write bits magnetically onto spinning platters and use only a modest amount of DRAM as a working scratchpad. DRAM, pronounced dee-ram, is dynamic random-access memory, the fast chip that holds whatever a machine is working on at this instant rather than storing it for later. Teh said the company had "definitely seen increasing costs" due to rising DRAM prices, while its own usage of the chips is "very small" next to that of computer makers or data-centre operators.
The scale of the move shows up in the contract market. The Post cites market intelligence firm TrendForce, which expected server DRAM prices in the first quarter of 2026 to rise by around 90 per cent against the previous quarter, reported as the steepest increase on record. That is a forecaster's expectation rather than a settled outcome, and no methodology accompanies it in the report, so it deserves holding at arm's length even as it points in the same direction as everything else here.
Demand has outrun the industry's own planning. Teh said his team five years ago expected annual growth in data storage demand to stay below 20 per cent, and it has instead been running in the mid-20s. "It’s a lot more if that’s translated into exabytes," he said. An exabyte is a billion gigabytes, which means a few percentage points at that scale amount to a great deal of physical hardware arriving in buildings that already exist.
Freight is the other line item. Crude prices briefly reached nearly US$120 a barrel, the highest level in four years, before retreating to below US$100, and Teh said volatile oil prices driven by turmoil in the Middle East had a significant impact. "We are obviously looking at many different solutions, for example, how we route the shipment of our products," he said. Rerouting is the diplomatic word for a longer voyage and a larger invoice.
What the remarks leave open is who absorbs the increase. Seagate's customers are the cloud operators building out AI capacity, and those are the same firms bidding memory prices up in the first place. The cost settles somewhere inside that loop, and nobody in it has said where.
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