alt Hacker NewsI don’t believe we are seeing the investments necessary that would indicate this will happen.
Memory makers, for example, have sold out their inventory for several years, but instead of investing to manufacture more, they’re shutting down their consumer divisions. They’re just transferring their consumer supply to their B2B (read AI) supply instead.
Thats likely because they don’t expect this demand to last past a few years.
Replies
How much capital would you invest in a capacity expansion for a trend that may or may not yet be durable? Now, how much would you invest when there are two major state-backed chinese entities that essentially aren't allowed to go bankrupt and have infinity money are competing with you?
If the demand lasts for a few years, I’m doubtful that all of the consumer capacity will come back.
They have seen boom and bust cycles previously and are understandably wary of expanding capacity for expected demand that may fizzle. If they stay too conservative, China’s CXMT is chomping at the bit to eat their lunch, backed by the Chinese government, but that’s not going to help until late 2027 at best.