Following the exceptionally strong earnings reports from Seagate Technology, a leading HDD manufacturer in the US, and South Korean memory chip giant SK Hynix, which spurred a collective rally in global memory chip and storage product stocks, the storage sector today received what can be described as a "nuclear-grade positive catalyst." The latest performance data from Samsung Electronics Co., the world's largest supplier of DRAM memory chips, reveals that the tech giant's chip business exceeded nearly all analyst expectations with a profit surge of over fivefold, serving as an unprecedented, heavyweight signal of the sustained demand explosion for DRAM/NAND flash memory chips driven by the historic wave of AI spending. The South Korean tech behemoth also plans to expand sales of chips closely linked to AI training and inference and is highly likely to begin deliveries of its next-generation high-bandwidth memory system—HBM4—to the "AI chip superpower" NVIDIA Corp. in the first quarter. This represents one of the most critical technological steps in AI computing infrastructure and a pivotal move for Samsung to catch up in market share of high-margin HBM products with its smaller domestic rival, SK Hynix Inc. Samsung's latest earnings show that for the quarter ending in December, the operating profit of its chip division skyrocketed to 16.4 trillion Korean won (approximately $114 billion), a staggering year-on-year increase of 465%, far surpassing the average analyst expectation of around 10.85 trillion won. Samsung's Device Solutions division (also known as the DS division, encompassing memory and foundry operations), saw its memory chip business achieve record-high quarterly revenue and operating profit, primarily driven by expanded sales of high-value-added products like HBM and the sustained overall price increases in the DRAM market where Samsung holds a dominant position. Samsung Electronics' overall revenue for the fourth quarter of 2025 reached 93.8 trillion won, a 23.8% increase year-on-year and a 9% increase sequentially; its overall operating profit was 20.1 trillion won, soaring 209.2% year-on-year, setting the company's strongest quarterly performance in history and a record high for any South Korean company. For the full year 2025, revenue was 333.6 trillion won and operating profit was 43.6 trillion won, increasing by 10.87% and 33.3% respectively compared to the previous year. A key signal from this latest financial report indicates that Samsung has successfully commenced deliveries of HBM3E to NVIDIA and has secured a position in the HBM supply chains for Google and AMD, which are crucial supporting factors in Samsung's recapture of the top spot in DRAM market share. Leveraging breakthroughs in high-bandwidth memory technology and significant ongoing price increases in the DRAM market, the world's largest memory chip manufacturer achieved dual records for quarterly revenue and operating profit in Q4 2025, reclaiming the sales crown for dynamic random-access memory from its competitor SK Hynix. Samsung Electronics' net profit for the fourth quarter was approximately 19.29 trillion won, also exceeding the average analyst estimate of 15.1 trillion won. Samsung also announced plans for a share buyback worth about 3.57 trillion won in the near future and declared a special dividend, raising its total dividend payout for the fourth quarter to 3.75 trillion won. In terms of stock performance, the company's share price doubled in 2025 and has surged approximately 35% since the start of 2026, reflecting market anticipation for "another year of explosive growth for memory chips," driven by surging demand amid the global torrent of AI computing expansion, which has led to persistent supply shortages and faster-than-expected price increases for the three major memory chip manufacturers: Samsung, SK Hynix, and Micron Technology. This growth reflects the rapid pace of change in industry dynamics—especially as hyperscale cloud providers like Microsoft, Google, and Amazon continue to pour hundreds of billions of dollars into AI infrastructure investments. By the close of trading on Wednesday in the US, memory chip and storage product stocks experienced a collective bullish frenzy; fueled by strong earnings, Seagate's stock surged nearly 20%, another HDD leader Western Digital rose over 10%, SSD leader SanDisk gained close to 10%, and the US's sole major memory chip maker, Micron Technology, climbed over 6%. These storage-related stocks were among the brightest performers in the US market throughout 2025, continuing an unprecedented bull trend. During the nearly year-long bull run for storage stocks, besides the significant gains for the three major memory chip makers SK Hynix, Samsung, and Micron, the stock prices of the three storage product giants—Seagate, SanDisk, and Western Digital—all surged over 200% in 2025, with enterprise SSD leader SanDisk's stock rising by a staggering nearly 600%, substantially outperforming the broader US market and global equities. So far in 2026, SanDisk's stock has already surged 122%, leading gains in the S&P 500 and the global tech sector. Whether it's Google's massive TPU AI computing clusters or vast arrays of NVIDIA AI GPUs, all rely heavily on integrated HBM memory systems paired with AI chips, and tech giants accelerating the construction or expansion of AI data centers require large-scale purchases of server-grade DDR5 memory and high-performance enterprise SSDs/HDDs. Samsung, SK Hynix, Micron, along with the three storage product leaders, are strategically positioned across key segments of this core storage domain: HBM, server DRAM (including DDR5/LPDDR5X), and high-end data center SSDs/HDDs, making them the most direct beneficiaries of the "AI memory + storage stack" and allowing them to capture the "super红利" of the AI infrastructure wave. Demand for DRAM/NAND memory chips remains robust, and prices for these product series (such as DDR4/DDR5/enterprise SSD series) are exhibiting rampant expansion, primarily because the flood of AI computing has elevated the demand for memory chips and their importance to AI training/inference systems to unprecedented levels. Global AI computing demand continues to show an exponential growth trend, with supply struggling to keep pace with demand intensity, a fact evident from the exceptionally strong recent earnings of "the world's chip king" TSMC and "lithography machine king" ASML. On Wall Street, Morgan Stanley, Nomura, and Bank of America are proclaiming the full arrival of an AI-driven "memory chip super cycle," whose intensity and duration could far surpass the "cloud computing-era driven memory super bull market" of 2018. Extremely bullish global sentiment towards memory chips propelled South Korea's benchmark Kospi index to a staggering 76% gain in 2025, making it the wildest-performing major stock market globally that year, largely driven by the frenzied rises of its two largest constituents, global memory leaders SK Hynix and Samsung Electronics, which together account for over 30% of the index's weight and contributed nearly half of its gains. On January 22, 2026, the Kospi index briefly broke through the historic 5000-point milestone to set a new record high and has since stabilized above that level while continuing to reach new peaks, again thanks to the strong performance year-to-date of its two heavyweight memory chip giants. This time is truly different! Memory chips shed the "cyclical" label. Samsung's robust performance follows better-than-expected results from smaller rivals like Seagate and SK Hynix, indicating that intense global corporate demand for memory chips and storage products driven by AI training/inference is outstripping supply, delivering windfalls for industry leaders. Meta Platforms and Microsoft Corp., in their earnings releases, disclosed plans for continued significant growth in AI capital expenditures, suggesting this "memory chip super cycle" is far from over. Concurrently, this unprecedented demand surge, fueled by fervent AI data center construction, is causing severe shortages of traditional DRAM and NAND used in modern consumer electronics from PCs to smartphones. "Samsung's confidence in HBM4 shows its 'fast follower' path is finally bearing fruit," said Greg Roh, a senior analyst at Hyundai Motor Securities. "The company now appears to have a unique technological edge and is expected to lead the global memory industry's transition to next-generation HBM later this year." Memory chip manufacturers are reallocating production lines to much more profitable HBM to meet the near-"insatiable" strong demand from AI data centers. Since HBM requires approximately three times the wafer capacity per unit of memory compared to standard DRAM, this shift has significantly reduced supply destined for the consumer electronics industry, threatening PC makers and smaller electronics companies with double-digit price hikes. Strong demand for memory components essential to AI training/inference systems from large-scale AI data centers under construction worldwide is exceeding supply, benefitting memory chip companies like Micron. However, a sharp shortage has also emerged for lower-spec memory products used in consumer electronics like PCs and smartphones, collectively pushing DRAM and NAND product prices into a frenzy. This largely stems from the industry's shift in capacity towards more advanced manufacturing processes for AI data centers. The three dominant memory chip makers—SK Hynix, Samsung, and Micron—are concentrating a majority of their capacity on HBM systems, which require far more advanced process capacity and manufacturing/packaging complexity compared to DDR series or HDD/SSD memory chips. This ongoing migration of capacity to HBM is a primary reason for the supply shortages in these storage product categories. Market focus is centered on the battle for leadership in next-generation HBM4, which will be fully integrated with NVIDIA's upcoming flagship Rubin AI computing infrastructure. Samsung is nearing certification from NVIDIA for its latest AI memory system—its proprietary HBM4. "SK Hynix still holds a clear lead in HBM technology, while Samsung is striving to close the gap," said Young Jae Lee, Senior Investment Manager at Pictet Asset Management. "Investors will continue to closely monitor both companies' outlooks on the memory market." Undoubtedly, throughout 2025 and continuing into the start of 2026, memory chip stocks and high-end storage product stocks have been among the hottest investment themes in global equity markets—for instance, data center enterprise SSD component leader SanDisk has already gained over 120% year-to-date in 2026. Despite the parabolic super bull run in 2025 and its continuation into 2026, global investors are not overly concerned about the suddenly elevated valuations of these storage tech companies, believing the unprecedented frenzy of AI data center construction is altering the "strongly cyclical nature" of the memory chip sector. "The old cyclical playbook for memory has been torn up forcefully," said Joe Tigay, Portfolio Manager at Equity Armor Investments. "This is a new world with a meaningfully higher floor, which implies that expensive stock prices and valuation trends will be more sustainable than in past cycles. The world's largest tech companies, with unimaginably deep pockets, will be fiercely competing for storage products for a considerable time." "This time is indeed different," said Francisco Jeronimo, an analyst at IDC, who described the price increases for memory chips/products as a "crisis" for some hardware manufacturers. "This is not a normal cycle. It's a profound, long-term change that could last two to three years." Although the phrase "this time is different" is often associated with market tops, Jeronimo believes the critical role of memory in AI infrastructure could permanently raise the price floor. "Even if the AI bubble bursts or AI storage demand slows, I don't think prices will go back to where they were six months ago," he stated. Furthermore, the AI data center construction boom is also helping to boost Samsung's own foundry business, which competes fiercely with the foundry superpower TSMC. Samsung stated that its contract chip manufacturing business saw significant sales growth in the quarter ending December and expects the business to continue recovering in the current quarter. The foundry division is also ramping up production of cutting-edge 2nm-class chips and targets double-digit revenue growth in 2026. The market is still underestimating storage demand! Divya Mathur, an emerging markets equity portfolio manager at ClearBridge Investments, recently stated that memory chip stocks and high-end storage product stocks are among the most investable areas in global equity markets, emphasizing that the market continues to underestimate the intensity of AI infrastructure-driven demand for memory chips. The ClearBridge SMASh Series emerging markets equity fund managed by Mathur has outperformed 97% of its peers over the past year according to institutional data, with the fund making significant bets on memory chip giant Samsung Electronics—whose stock doubled in 2025—and SK Hynix, whose stock nearly quadrupled in 2025. Mathur expects this bull trend to persist long-term, stating that the AI wave will permanently reshape this long-perceived cyclical and commoditized chip industry. "Since the semiconductor era began, the memory industry was never built for the data storage needs of the AI domain—but in the past year or so, we have seen this new growth driver emerge," said the seasoned fund manager Mathur, who is one of the specialized portfolio managers at global asset management giant Franklin Templeton jointly managing this approximately $1.4 billion emerging markets equity fund. He has held both memory chip stocks since 2015 and his bullish conviction has grown stronger and more long-term. "Furthermore, based on my conversations, some US tech clients indicate the storage industry is only in the second year of a decade-long super upgrade cycle," he added in a media interview. On its earnings call, Seagate's CEO Dave Mosley stated that revenue saw significant sequential growth in "almost all end markets" during the quarter, setting new company records for exabyte shipments, gross margin, operating margin, and non-GAAP EPS. He described storage demand as "exceptionally strong," particularly in the data center end market, noting sustained significant growth in demand for high-capacity nearline HDDs from global large-scale AI data centers and improving demand for enterprise edge computing. Regarding Seagate's 2026 capacity planning, Mosley said that Seagate's nearline HDD capacity is "sold out for the entirety of 2026," and the company expects to begin accepting orders for the first half of 2027 in the coming months. Seagate benefits immensely from the near-"insatiable" storage demand driven by the unprecedented global AI computing torrent, primarily due to the explosive expansion demand for its data center-grade nearline HDDs and high-performance SSDs from hyperscale AI data centers like the reported "Stargate" project. Nomura's latest assessment reiterates that this "memory chip super cycle" will last at least until 2027, explicitly stating in a research report that "meaningful supply additions are not expected until 2028 at the earliest." The report repeatedly emphasizes that expanding capacity for memory chips and HDD/SSD components is not something that can be done overnight, involving complex timelines for greenfield/brownfield projects and customized semiconductor equipment upgrade plans. Using SK Hynix as an example, Nomura points to constraints like long lead times for cleanroom construction/wafer capacity, significant delays in yield and cycle times from advanced process upgrades, and limitations on building/upgrading overseas fabs, leading to the conclusion that supply increases will be slower and shortages will persist longer. Analysts at Citigroup present an even more aggressive bullish stance in their latest outlook. They believe that driven by the proliferation of AI Agents and surging memory demands for AI CPUs, memory chip prices will experience runaway increases in 2026. Citi's analysts have drastically raised their 2026 average selling price growth forecast for DRAM from 53% to 88%, and for NAND from 44% to 74%. They project that server DRAM ASPs will surge 144% year-on-year in 2026 (up from a previous forecast of +91%), driven by both AI training and inference demand; for example, they forecast the price of a mainstream 64GB DDR5 RDIMM to reach $620 in Q1 2026, a 38% sequential increase, far above the previous forecast of $518. In the NAND sector, Citi's forecasts are equally aggressive, raising the 2026 ASP growth expectation from +44% to +74%; enterprise SSD ASP is expected to increase 87% year-on-year. In the view of Citi's analysts, the memory chip market is entering an extremely intense seller's market, with pricing power firmly in the hands of storage giants like Samsung, SK Hynix, Micron, and SanDisk.