[Edaily Reporter RHEE JAE-EUN ] Despite concerns over slowing growth and funding challenges among artificial intelligence (AI) companies, Nomura Securities maintained its “Buy” rating on Samsung Electronics and SK Hynix. The firm placed greater emphasis on expanding demand driven by data center expansion rather than the financial burdens faced by individual companies. Nomura predicted that the situation where supply expansion fails to keep pace with rising demand will continue at least through 2028.

On the 20th, in its Global Memory Report, Nomura selected Samsung Electronics [005930] and SK Hynix [000660] as “Stocks to Watch” and issued a “Buy” rating. The firm set target prices of 670,000 won and 4.7 million won, respectively.

The expansion of data centers was cited as the key rationale. The scale of new global data center facilities tracked by Nomura is projected to increase by approximately 41%, from 22.3 gigawatts (GW) this year to 31.5 GW next year. Consequently, Nomura expects the pace of memory demand growth to outstrip supply expansion, sustaining a price-friendly environment.

Nomura analyzed that the likelihood of financial difficulties faced by individual data center operators leading to a halt in AI investment overall is limited. The firm explained that even if a specific operator faces difficulties, the data centers and equipment already in place can be utilized by other operators. It also assessed that market concerns surrounding China’s Changxin Memory (CXMT) transition to 4F² technology are excessive.

Taiwan-based market research firm TrendForce also forecast growing demand for AI servers. On the 14th, TrendForce stated, based on its latest AI server industry survey, that major cloud service providers (CSPs) are expanding their investments in servers and AI infrastructure.

It projected that the combined capital expenditures (CAPEX) of nine major global CSPs will reach $957 billion this year—a 106% increase from the previous year—and will grow by an additional 60% next year, surpassing $1.5 trillion. Both this year’s and next year’s projections have been revised upward from previous estimates. The survey covered Google, Amazon, Meta, Microsoft, Oracle, as well as China’s ByteDance, Tencent, Alibaba, and Baidu.

TrendForce cited rising server system prices, increased component costs due to supply shortages, and advance payments made to secure supplies as the reasons for the upward revision. The report explained that CSPs are bringing forward their cash outlays as some component suppliers are demanding advance payments.

They also forecast that AI server shipments will increase by 32.2% year-over-year this year and by nearly 36% next year. The analysis suggests that demand from large CSPs, as well as AI-specialized cloud providers, government-led AI projects, and large language model (LLM) developers, will underpin this growth.

However, Nomura added that the memory demand outlook would need to be reassessed if data center investment plans continue to be scaled back or if even projects with secured funding face significant delays.