Falling DRAM costs impact hardware end market pricing

By Staff

DRAM prices have been falling since the first-half of 2018. For commodity purchasing and supply chain managers, DRAM can account for roughly 25% to 30% of the cost of bill of materials (BOM) for cloud servers. This can be equally noteworthy for other hardware products in other end market sectors.

DRAM prices falling

For cloud servers, in particular, for every downward percentage move of DRAM prices, say 10%, depending on manufacturing operations, this can have a 10 to 15 basis points impact on margins according to Morgan Stanley Research. Other BOM line items impacting storage equipment include CPUs and chipsets, power supplies, casings and enclosures, to name a few. Read more here.

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