Wednesday, January 22nd 2025
NAND Flash Manufacturers to Resume Production Cuts in 2025 to Ease Supply-Demand Imbalance and Stabilize Prices
TrendForce's latest research report highlights that the NAND Flash industry will continue to face dual pressure from weak demand and oversupply in 2025. In response, manufacturers including Micron, Kioxia/SanDisk, Samsung, and SK hynix/Solidigm have similar plans to cut production—a move that could accelerate industry consolidation in the long term.
TrendForce reports that NAND Flash manufacturers are primarily implementing production cuts by lowering utilization rates and delaying process upgrades. These actions are driven by three major factors:
Firstly, core consumer electronics like smartphones and notebooks continue to suffer from sluggish shipments. Additionally, slowing corporate IT investments are dampening growth in enterprise SSD demand.
Secondly, NAND Flash prices have been in decline since 3Q24, and suppliers remain pessimistic about demand in the first half of 2025. The prolonged price weakness risks further eroding profit margins, thereby compelling manufacturers to reduce output.
Lastly, Chinese suppliers are aggressively expanding production thanks to domestic substitution policies, intensifying global market competition.
TrendForce points out that several NAND Flash manufacturers are implementing production cuts to address market challenges. Micron has already announced its plans, while Kioxia and its partner SanDisk are also preparing similar measures. These two companies—heavily reliant on NAND Flash products without the balancing revenue of DRAM businesses—are expected to experience a greater financial impact from reductions compared to their competitors.
Samsung, despite maintaining leadership in enterprise SSDs and other sectors, faces mounting inventory pressures due to intensifying competition in the Chinese market and its ongoing transition to new technologies. The company has also announced plans to reduce production this year.
SK hynix (including Solidigm), though performing strongly in the enterprise SSD segment in 2024, has not been immune to the broader demand slump, necessitating adjustments to its production strategy.
TrendForce notes that while short-term production cuts may help stabilize prices and alleviate pressure from oversupply, rising prices could also increase costs for downstream manufacturers, potentially dampening consumer demand.
In the long term, production reductions may accelerate industry consolidation, posing exit risks for less competitive players. To maintain viability, manufacturers need to intensify efforts in technological innovation and product differentiation, enhancing their competitive edge and tapping into niche markets.
Source:
TrendForce
TrendForce reports that NAND Flash manufacturers are primarily implementing production cuts by lowering utilization rates and delaying process upgrades. These actions are driven by three major factors:
Secondly, NAND Flash prices have been in decline since 3Q24, and suppliers remain pessimistic about demand in the first half of 2025. The prolonged price weakness risks further eroding profit margins, thereby compelling manufacturers to reduce output.
Lastly, Chinese suppliers are aggressively expanding production thanks to domestic substitution policies, intensifying global market competition.
TrendForce points out that several NAND Flash manufacturers are implementing production cuts to address market challenges. Micron has already announced its plans, while Kioxia and its partner SanDisk are also preparing similar measures. These two companies—heavily reliant on NAND Flash products without the balancing revenue of DRAM businesses—are expected to experience a greater financial impact from reductions compared to their competitors.
Samsung, despite maintaining leadership in enterprise SSDs and other sectors, faces mounting inventory pressures due to intensifying competition in the Chinese market and its ongoing transition to new technologies. The company has also announced plans to reduce production this year.
SK hynix (including Solidigm), though performing strongly in the enterprise SSD segment in 2024, has not been immune to the broader demand slump, necessitating adjustments to its production strategy.
TrendForce notes that while short-term production cuts may help stabilize prices and alleviate pressure from oversupply, rising prices could also increase costs for downstream manufacturers, potentially dampening consumer demand.
In the long term, production reductions may accelerate industry consolidation, posing exit risks for less competitive players. To maintain viability, manufacturers need to intensify efforts in technological innovation and product differentiation, enhancing their competitive edge and tapping into niche markets.
4 Comments on NAND Flash Manufacturers to Resume Production Cuts in 2025 to Ease Supply-Demand Imbalance and Stabilize Prices
Rules of Acquisition #10: "Greed is eternal" :D
They are all doing it for a very long term. The NAND industry is stuck in 2014. There's no progress. Only degradation. I could understand if the high prices were high due to SSDs being SLC/MLC. But all the storage is only QLC at best, or even PLC, with the lifespan of a sour milk. At least in the consumer space.
As of prices themselves... for example, the Solidigm P44 512GB, back in the end of 2023, right before the promised price
gouging, *ahem* increase, had a price of about $48-$52. Year later, the same SSD had a price of $102+. The same goes for all storage, at least in country of mine. Now tell me, that this isn't f*ckin enough already...You seems don't get it. They will increase or at least keep the prices in any case, regardless of reasoning (the only reasoning is greed). The disasters would be the additional bonus. They all are profiting from AI craze, as never before. There's no way, they have weak margins already. They just went completely mad, and their greed has become unstopable.They are the same companies, that do DRAM. There's no other manufacturers.