JPMorgan Defies HBM Downgrade Concerns, Sees 63% Demand Growth Through 2028

JPMorgan has pushed back on concerns over high-bandwidth memory (HBM) specification downgrades, stating that they will not impact demand. In its latest report, the bank forecasts a 63% compound annual growth rate in HBM bit demand from 2026 to 2028.

The supply shortage is expected to persist, with JPMorgan estimating that achieving DRAM supply-demand balance in 2028 would require approximately 300,000 additional wafer starts per month. The 'Die Penalty' effect on supply constraints means producing the same number of HBM bits requires roughly 3 to 4 times the wafer resources of conventional DRAM.

The shift in downstream customer structure is also noteworthy, with ASIC (Application-Specific Integrated Circuit) custom chip system shipments growing at a 102% annual rate, outpacing Nvidia's 15%. By 2027, ASIC demand share is projected to climb to 48%, while Nvidia's share falls to 43%, making ASIC the largest HBM consumer.

JPMorgan remains bullish on memory stocks, arguing that the market has partially priced in specification downgrade concerns. The bank favors SK Hynix as its top pick and expects Samsung's HBM market share to rise from 20% in 2025 to 39% in 2027.