Dell CEO Warns Memory Shortage Will Worsen in 2027, Hindering AI Server Delivery

October 21 — Michael Dell, Chairman and CEO of Dell Technologies, believes that the memory shortage is far from over.

In an interview with The Wall Street Journal, he stated that supply conditions will deteriorate further next year as AI data centers continue to consume large volumes of Dynamic Random Access Memory (DRAM) and High Bandwidth Memory (HBM). According to Dell, the bottleneck facing the company is not demand; Dell currently holds approximately $95 billion in undelivered AI server orders (IT Home note: equivalent to roughly RMB 635.675 billion at current exchange rates), marking a record-high backlog. The constraint on delivery is memory: AI accelerator chips require massive amounts of HBM, while the accompanying servers still rely on traditional DRAM.

Relief in supply appears distant. New memory fabrication plants take about four years to build, so Dell expects significant new capacity to emerge only around 2029 or 2030. This aligns with the view of Micron’s CEO, who recently noted that supply tightness in 2027 and 2028 will be even more severe than this year. SK hynix’s CEO has offered a similar assessment, predicting that the memory shortage will persist until 2030. Dell’s strategy involves purchasing DRAM close to the final assembly stage and signing long-term supply agreements, though it remains unclear how extensively this approach covers consumer-grade products.

PC consumers have felt the impact of the memory shortage for months. Over the past 12 months, memory prices have surged by nearly 500% and continue to rise, affecting all categories within the DIY PC market. On Dell’s end, the company raised PC prices by 15% to 20% late last year, and reports suggest monitor prices may also increase this month. If the shortage worsens further in 2027, the entire industry is likely to face additional rounds of price hikes.