Micron CEO Sanjay Mehrotra: RAM shortages likely won’t ease until 2028

If you’re waiting for the memory shortage to end, Micron CEO Sanjay Mehrotra just moved the finish line. In Micron’s Q3 earnings report to investors, Mehrotra said the industry should expect “tight conditions” to persist beyond calendar 2027, and that the company currently does not have “line of sight” on when memory supply can catch up with increasing demand. In plain terms: even as 2028 is when supply is expected to improve gradually, the broader market may still feel shortage pressure.

That matters because the shortage is already showing up in the price tags. The source notes a year of increases across gaming hardware: Nintendo Switch 2 prices jumped by $50, a PlayStation price hike pushed the premium PS5 Pro to $900, Valve raised the entry price to the Steam Machine lineup to $1,049, and Microsoft raised Xbox prices by $100-$150 depending on the model. RAM is central to gaming PCs and also influences the cost structure of systems more broadly, so when memory stays expensive, it tends to travel from the component supply chain to the consumer’s wallet.

Why is this happening now, and why does it last? Mehrotra tied the problem to AI-driven demand across all segments coupled with structural supply constraints. The source frames it as a “perfect storm” where inflation, US government tariffs, and memory shortages caused by rapid AI data center development collide. The gaming industry does not exist in a vacuum, and memory is one of those upstream inputs that gets pulled in multiple directions at once. AI data centers need large memory footprints, and that competes for capacity that could otherwise support consumer hardware cycles.

For decision-makers, the key phrase in Mehrotra’s comments is the lack of “line of sight” on when supply will catch up. That is not the language of a temporary disruption that ends when a factory comes back online. It is the language of a market where demand growth outpaces supply additions, at least through the near-term horizon investors are focused on. Even if industry supply “improve[s] gradually in 2028,” the source emphasizes that memory supply may not be able to meet increasing demand fast enough. Put differently: 2028 is not a switch that flips from red to green.

Now zoom out to the gaming hardware pipeline and the knock-on effects. The source flags analysts who predict next-gen consoles could launch with 50% higher price tags than current-gen, and notes that $1,000 base models are not out of the question. That is the kind of pricing pressure that forces companies into hard tradeoffs: either absorb margins, redesign BOMs, change manufacturing priorities, or pass costs to consumers. When the component in question is memory and it stays constrained longer, it constrains all the other options.

There is also a timing strategy lurking here: delay. The source suggests Microsoft and Sony could choose to wait out the RAMpocalypse by delaying new consoles until component shortages and related price elevations ease. It even notes reports indicating Sony is already considering an internal delay. For executives, this becomes a board-level question, not just a product calendar issue. Delaying can protect pricing power and reduce the risk of launching a premium-priced product into a constrained component market. But delays can also extend the lifespan of current hardware, reshape developer planning, and shift competitive dynamics. In short: RAM shortages do not only raise costs, they can rewrite product schedules.

The stakes extend beyond the hardware SKU. If console timelines slip or prices rise, the developer ecosystem feels it. The source includes a broader indicator that Xbox studios are bracing for a “reset,” and mentions that South of Midnight developers from Compulsion Games begin looking for work. That point is not claiming a direct causal line from RAM shortages to studio layoffs, but it underscores how quickly second-order pressures can cascade when platforms wobble or strategies change.

The executive takeaway is uncomfortable but useful. When the supply constraint has a multi-year timeline, boards should plan for more than a quarter of headwinds. They should stress test pricing scenarios, inventory and component procurement assumptions, and platform roadmaps against a world where memory supply remains behind demand even as it gradually improves. In a market where a $50 jump here and a $100-$150 jump there become normal, the companies that win will be the ones that align product timing, cost structure, and ecosystem expectations with the reality that, as Mehrotra put it, the industry does not have clear visibility on when supply will fully catch up.