The artificial intelligence revolution is creating an unprecedented surge in demand for memory chips, with global memory giant Micron Technology expecting tight supply conditions for both DRAM and NAND well beyond 2027.
In its Fiscal Q3 2026 earnings call, Micron said AI data centres have become the primary growth engine for the memory industry. The company noted that demand for memory is significantly outpacing supply as cloud providers and enterprises invest heavily in AI infrastructure.
“DRAM and NAND industry demand continues to significantly exceed industry supply. We expect tight conditions to persist beyond calendar 2027 as a result of AI driven demand across all segments coupled with structural supply constraints,” said Sanjay Mehrotra, Chairman, President and CEO of Micron.
DRAM, or Dynamic Random Access Memory, is the high speed memory used by processors to temporarily store and access data. It plays a critical role in AI servers, graphics processors and high performance computing systems where massive amounts of data need to be processed quickly. NAND, on the other hand, is a type of flash memory used for long term data storage in solid state drives (SSDs), smartphones, laptops and data centres.
Micron said the AI infrastructure buildout is boosting demand for both technologies. The company expects industry DRAM bit shipments to grow in the low to mid 20 per cent range in calendar 2026, while NAND bit shipments are projected to increase by around 20 per cent.
The company reported record quarterly DRAM revenue of $31.3 billion, accounting for 76 per cent of total revenue. NAND revenue also reached a record $9.9 billion during the quarter.
According to Micron, the impact of AI extends beyond AI accelerator servers. The company expects industry data centre DRAM and NAND shipments in 2026 to be more than double the levels seen two years ago. Growing adoption of agentic AI applications is increasing the need for both computing memory and storage infrastructure.
Micron also highlighted the growing role of NAND based storage in AI workloads. “In NAND, AI context memory storage and HDD displacement opportunities are expanding the addressable market for SSDs,” the company said.
The data centre business continues to be a major growth driver. Micron disclosed that its annualised data centre revenue run rate has surpassed $100 billion, while data centre SSD revenue more than doubled sequentially to exceed $5 billion.
Summing up the opportunity, Mehrotra said: “AI has elevated the value of memory.”
For the semiconductor industry, Micron’s comments reinforce a key trend. As AI models become larger and more complex, demand for both DRAM, which enables faster processing, and NAND, which stores vast amounts of data, is expected to remain strong for years to come.
