Dell CEO: AI memory demand will surge by 625 times, and supply shortages will persist for several years

The explosive expansion of AI infrastructure is creating a structural supply-and-demand imbalance. Dell Technologies CEO Michael Dell warned that, as accelerator memory capacity per single unit and the scale of data center deployments expand in tandem, global AI memory demand will surge 625x from current levels, while the supply side will take years to catch up.

On the 7th local time, Michael Dell made the above remarks when attending an industry event hosted by Bank of America in the United States. He said that in AI infrastructure, the memory capacity of each accelerator and the overall system scale are expanding synchronously; together, they will form a structural pattern in which total memory demand grows by about 625x. He also emphasized that, “The expansion of memory supply will take years, but current demand for AI infrastructure has not slowed down—we are still in the early stage of technology adoption.”

This statement has direct implications for the memory market: the continued existence of the supply-demand gap means memory suppliers may be able to maintain price support for a relatively long period, and the strong momentum in cloud computing and enterprise server procurement will also continue to provide order momentum for infrastructure vendors such as Dell.

625x demand: the structural logic of stacking two “25x” factors

Michael Dell provided a specific walkthrough for the 625x figure.

In terms of memory capacity per server, NVIDIA H100 GPU was equipped with 80GB of memory in 2022, and by 2028, the expected memory capacity per accelerator server will reach 2TB, achieving about 25x growth.

Meanwhile, the deployment scale of accelerators in data centers will also expand by about 25x. With these two factors multiplied, the increase in total memory demand will reach 625x (25×25).

However, the responsiveness on the supply side is far slower than on the demand side. Michael Dell pointed out that in 2023, memory manufacturers cut capital expenditures during the industry downturn cycle, and the resulting lack of investment directly led to the current supply shortage situation. He expects this gap to persist for the next several years.

Demand resilience: dual support from sovereign AI and enterprise upgrades

Despite supply constraints, Michael Dell holds an optimistic view of the overall demand outlook for AI infrastructure, and he highlighted two main demand lines.

The first is investment in sovereign AI. He said that countries around the top 25 by GDP are, for the most part, advancing their national sovereign AI projects in one form or another, and heightened geopolitical tensions further accelerate each country’s willingness to build autonomous AI capabilities, thereby keeping server demand strong.

The second is enterprise-side productivity-driven demand. Michael Dell used the example of knowledge workers earning an annual salary of $100,000 to point out that it is “not reasonable” for such employees to keep using outdated PCs or inefficient systems; from the perspective of productivity, enterprises will have to continue pushing infrastructure investment.

“Whether to buy” isn’t the issue; “when to buy” is

For the demand uncertainty in the market, Michael Dell offered a clear qualitative judgment.

He said that there may be price increases or phased delays, but in the end, enterprises and cloud service providers find themselves in the position of having to purchase infrastructure. He attributed the current market divergence to a timing issue rather than a direction issue, saying plainly, “The issue isn’t whether to buy, but when to buy.”

This statement is intended to send a signal to the market: the AI investment cycle of Hyperscaler firms is highly certain; short-term fluctuations will not change the long-term procurement trend, and Dell Technologies’ server business will also continue to benefit from this structural growth.

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