JPMorgan has significantly raised its global storage market size forecast in its latest research report, maintaining a multi-year bullish stance on the sector. The firm believes that memory chips are transitioning from traditional cyclical commodities into strategic core assets for AI infrastructure. JPMorgan projects total global storage capital expenditure over the next three years to reach approximately $450 billion, a substantial increase from its previous model. Within this, DRAM is expected to account for roughly $364 billion cumulatively over three years, with 60% of incremental capacity allocated to HBM.
The report raises its total global storage market forecast for 2026–2028 by 37% to 53% compared to its March model, projecting the total market size to reach $1.7 trillion by 2028. Specifically, DRAM market revenue is expected to jump from $143 billion in 2025 to $636 billion in 2026, before reaching $1.237 trillion by 2028. Meanwhile, the NAND market revenue is projected to grow from $710 billion to $454.5 billion over the same period.
JPMorgan anticipates that the supply-demand gap will widen further in 2027, theoretically providing additional upside for DRAM and NAND prices. However, the increasing share of long-term contract sales is expected to stabilize price trends.
The report notes that AI computing demand is accelerating its spread from GPUs to CPUs, acting as the latest catalyst for the current storage upcycle. JPMorgan has raised its server memory demand forecast for 2026–2028 by 5% to 22%, emphasizing that over 60% of this increase comes from incremental contributions from AI servers. Consequently, AI server memory demand (excluding HBM) is expected to account for over 30% of total DRAM demand in 2027–2028, compared to a previous forecast of just 14%.
The high-bandwidth memory market continues to experience tightening supply-demand dynamics. JPMorgan has raised its HBM market size forecast for 2026–2028 by 17% to 21%, projecting that supply-demand gaps will persist throughout 2028. On pricing, the firm expects the blended average selling price for HBM in 2027 to rise 32% year-on-year, reaching an all-time high.
The share of storage in CSP hardware capital expenditure has risen sharply from just over ten percent in the early days of the AI wave, is expected to exceed 50% this year, and could reach 73% by 2030. JPMorgan forecasts that the operating margin of the storage industry will stabilize at historically high levels of 75% to 77% between 2026 and 2028. However, the report candidly notes that memory stocks are still trading at a discount to earnings valuations, primarily due to investor doubts about whether storage’s value share can continue to rise. JPMorgan points out that AI has brought an entirely new demand structure, rendering traditional cyclical valuation frameworks obsolete.
Enterprise solid-state drives are becoming the core driver of NAND market expansion. JPMorgan expects the eSSD market to exceed 500 exabytes in 2026, accounting for 43% of total NAND demand, and projects it will grow at a compound annual growth rate of 52% to over 1,100 exabytes over the next two years. Given the ASP premium, the total value of the eSSD market is expected to surpass $300 billion over the next two years. On the supply side, NAND capital expenditure remains below historical peak levels. JPMorgan estimates cumulative NAND capital expenditure over three years to be $86 billion, primarily directed toward technology migration.
