Morgan Stanley Sees Memory Chip Super-Cycle Extending Well Beyond End-2026, Driven by AI Demand

According to Morgan Stanley's latest report, the current memory super-cycle is accelerating and will extend significantly beyond historical DRAM cycles, driven by unprecedented structural demand from AI agents. The bank identified three distinctive features setting this cycle apart: strong and sustained AI-driven demand concentrated in a single sector; supply-side constraints from fab capacity and EUV lithography machines limiting production expansion; and long-term agreements reshaping industry pricing dynamics and improving earnings predictability.

Goldman Sachs strategist Ben Snider echoed optimism, noting that despite 2026 IPO activity reaching approximately 100 deals, the roughly $700 billion in new stock supply represents only 1% of the Russell 3000 index market cap. Goldman forecasts $1 trillion in corporate stock buybacks will offset new issuance, while M&A activity and institutional inflows will continue supporting market strength.