🟦Challenges of the NAND Flash Industry

The NAND flash industry in 2025 will still be under the double pressure of weak demand and oversupply. In this article, we’ll discuss the impact of this situation on the industry and how manufacturers are responding.

Press Center – NAND Flash Manufacturers to Resume Production Cuts in 2025 to Ease Supply-Demand Imbalance and Stabilize Prices, Says TrendForce | TrendForce – Market research, price trend of DRAM, NAND Flash, LEDs, TFT-LCD and green energy, PV

🟦 The NAND Flash Industry Challenges: What Will Impact Oversupply and Sluggish Demand in 2025?

The NAND flash industry is facing a tough time. As demand remains sluggish and oversupply, major manufacturers Micron, Kioxia, Samsung and SK Hynix are planning to cut production.

There are three main factors:

  1. Sluggish shipments of electronic devices such as smartphones and laptops
    • These products use a lot of NAND flash, but sales have been sluggish since the second half of 2024, and the demand for memory is also shrinking.
  2. NAND Flash Prices to Fall After Q3 2024
    • If prices continue to fall, manufacturers’ profit margins will decline, so it is necessary to stabilize prices by reducing production volumes.
  3. The Rise of Chinese Manufacturers
    • Chinese automakers with government support expanded production, and competition intensified in the global market. This makes it difficult for existing manufacturers to secure market share.

Against this backdrop, manufacturers are trying to reduce production and stabilize prices. However, if short-term production curtailments lead to higher prices, they can lead to higher costs for the final product, which could lead to a further decline in demand.

🟦 Transformative and Consolidation Potential of the NAND Flash Industry

This oversupply and low price situation is likely to accelerate consolidation across industries in the long run. According to a report by TrendForce, manufacturers are using different strategies to deal with the current situation.

  • Micron
    has already announced production cuts. We will continue to adjust supply while assessing future market trends.
  • Due to the difficulty of balancing the earnings of the KIOXIA
    DRAM business and the high dependence on the NAND flash business, the impact of the reduction is expected to be significant.
  • While Samsung
    maintains its leadership in the enterprise SSD space, inventory pressure is increasing due to increased competition in the Chinese market and the shift to new technologies. For this reason, we are moving forward with plans to reduce production in 2025 as well.
  • SK Hynix performed well in the enterprise SSD market in 2024,
    but it cannot resist the overall slump in demand, and it is necessary to adjust its strategy.

In this way, companies are innovating and adjusting production in order to survive, but in the long term, companies that are less competitive may withdraw from the market.

🟦 Summary

The NAND flash industry in 2025 faces the dual challenges of sluggish demand and oversupply. Manufacturers are reducing production to prevent prices from falling, but this is expected to lead to market consolidation and continued to intensify competition.

KIOXIA is heavily reliant on NAND flash, so it is inevitable that market downturns will have a direct and significant impact on management. While other manufacturers are able to diversify their risk in other businesses, such as DRAM, KIOXIA is susceptible to NAND price fluctuations, which is particularly difficult during a period of low demand such as this one.

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