AI and the Memory Crunch: Strategy with Jabil’s Graham Scott

The semiconductor market has always been cyclical, but the tempo has changed. Peaks and troughs are arriving faster, creating a level of volatility that many procurement teams are not equipped to absorb.

Graham Scott, Jabil’s Chief Procurement Officer, believes we have been in a shortage environment since early 2025. Speaking to Procurement Magaizne, he breaks down why memory is diverging from standard component trends and how leaders can protect their supply chains.

Why do semiconductor cycles feel more volatile lately?

"Semiconductors are inherently cyclical, but cycles are becoming shorter and sharper. In the past, we saw a predictable "feast and famine" pattern.

Now, when demand looks strong, capacity expansion accelerates rapidly; when a downcycle hits, the brakes are slammed, investment shifts and capacity is idled. This "whiplash" effect means disruption is now a structural planning factor rather than an occasional exception."

How is AI specifically reshaping the memory market?

AI is creating a unique set of incentives. Demand is shifting towards high-value products like High Bandwidth Memory (HBM) required by hyperscalers. Consequently, the "Big Three" manufacturers, Micron, Samsung and SK Hynix, are prioritising these high-margin AI requirements.

Traditional products like DDR4 and DDR5 become less attractive to produce. This pushes "everyday" demand towards smaller regional suppliers who lack the same scale, leaving sectors like healthcare, automotive and industrial at risk of being squeezed out.

What should organisations do right now to mitigate these risks?

Maximise optionality. Ensure you aren't structurally locked into single-source components. This doesn’t always require a total redesign; often, it’s about widening acceptable parameters, such as speed grades, voltage variants or tolerances, to "open the aperture" for available supply.

Long-term, you must follow the supplier’s technology roadmap. If you build designs around 20-year-old components, manufacturers won't be motivated to support you. Align with the platforms where suppliers are actively investing.

Can "circularity" play a role in solving shortages?

Absolutely. Through Jabil’s acquisition of Retronix, we’ve seen the value of component recovery. If you have a "bone pile" of legacy cards, we can harvest constrained processors or memory chips, reball/retin them and put them back into production. When new parts aren't coming off the line, the circular economy becomes a vital lever for continuity.

How have Jabil’s internal procurement capabilities evolved into a service?

Jabil is a manufacturing company at its core, but to keep that engine running, we manage over US$25bn in annual spend and 38,000 supplier relationships. We realised this practitioner-led expertise, knowing how to get an "unfair share" of components during shortages, was something we could offer to external partners, even those we don’t manufacture for. We provide everything from BOM management to navigating spot shortages.

What is the secret to a resilient procurement function?

You need the trifecta: People, Process and Technology.

• People: Focus on consistent behaviours and collaboration.
• Process: Creates repeatability in complex global chains.
• Technology: Augments decision-making and visibility.

The mistake is treating technology as a replacement for the other two. The real advantage comes when tech amplifies a disciplined operating model.

As AI pulls capacity towards the high end, legacy memory availability will tighten unevenly. Procurement teams that embrace AVL flexibility, align with modern technology roadmaps and explore recovery options will be the ones to navigate this new era of permanent volatility.

Learn more about Jabil Procurement and Supply Chain Services: 

Jabil Procurement and Supply Chain Services brings 60+ years of practitioner experience managing complex global supply chains for 400+ leading brands, supported by 100+ locations across 25+ countries and 38,000+ supplier relationships. From targeted advisory and assessments to managed services, logistics execution, and data-informed market intelligence, we help leaders turn procurement priorities into coordinated action across the enterprise. Acting as an extension of your team, we offer flexible and scalable procurement and supply chain services tailored to your unique business needs, ensuring your business can adapt and thrive in today's dynamic marketplace.
To explore how Jabil can support stronger procurement performance and broader business impact, connect with our team.