Storage vendors hike prices, shift supply chains amid DRAM crunch

AI demand for memory and hyperscaler stockpiling have tightened supplies of DRAM wafers, prompting Dell, HPE, NetApp and Everpure to raise storage prices, shorten quote commitments and adjust suppliers. Trendforce estimates AI will consume about 20% of DRAM wafer capacity in 2026. Ian Foddering, vice president at SHI, described the market as “a perfect storm” of AI demand, hyperscaler stockpiling and wafer reallocations and said pricing and quoting have become unpredictable.

Dell warned of higher prices late last year as executives pointed to rising memory and storage cost bases across products. Chief operating officer Jeffrey Clarke noted the company is drawing on experience from prior DRAM cycles as it works to limit customer disruption. Dell reported storage revenue grew 2% in the November-to-January quarter and said all-flash arrays posted their third consecutive quarter of double-digit growth.

Everpure delayed price increases until early February but said it could no longer absorb the rapid rise in component costs. Chief executive Charlie Giancarlo said the company aimed to keep increases smaller than competitors and has broadened its supplier base to reduce shipment delays. Everpure reported quarterly revenue above $1 billion for the three months ending Feb. 1, driven mainly by enterprise demand.

Hewlett Packard Enterprise revised contract terms to allow repricing for cost increases that occur between order and delivery. CEO Antonio Neri described an “agile pricing posture” and said the company shortened quote commitment periods to reflect faster changes in component costs. HPE reported that many customers prioritized speed of delivery over price, with some choosing lower-end configurations to receive equipment sooner. Revenue from the Alletra MP storage platform rose 42% year over year in the November-to-January period.

NetApp implemented price increases in early November and said it would raise prices again if needed. CEO George Kurian called memory price inflation “unprecedented” and said the company is working closely with customers and channel partners while staying in close contact with suppliers. NetApp posted a quarterly record $1 billion in all-flash revenue for November to January, up 11% year over year, and cautioned that the full effect of recent price increases may appear in later reports because many customers have 90- to 120-day purchase agreements.

Hyperscalers have been stockpiling parts to protect deployment schedules, further tightening supply for enterprise-focused products. Some enterprise buyers are altering system configurations or accepting longer lead times to obtain systems sooner. Vendors reported absorbing some costs where possible and passing on unavoidable increases through adjusted pricing or shorter quote windows.

Some analysts and vendor executives expect conditions could ease late this year or into early 2027 as new wafer lines come online. SK Group chairman Chey Tae-won warned that shortages could persist until 2030.

As AI compute demand affects chip allocation and logistics, enterprise storage vendors are managing higher DRAM costs with price adjustments, contract changes and supply-chain diversification while seeking to maintain deliveries.