Here comes a price increase: SSDs will now be affected
NAND Flash Memory Market: Recovery Drives Increase in Prices, Suppliers Seek Profitability
It is expected that, in 2024, SSD storage will experience an increase of up to 50%, according to data from TrendForce. After a drop in the prices of NAND Flash memories, the market is in the process of recovery, but the main suppliers have not yet reached the break-even point. Giants like Samsung, Kioxia, SK Hynix and Micron seek to achieve profitability by aggressively driving prices.
According to TrendForce reports, Samsung maintains market leadership with a 31.4% share, followed by SK Hynix, Western Digital and Kioxia. The search for profitability led to a reduction in production, with Samsung reducing total production capacity by 50%, focusing on products with stacked layers of up to 128 layers.
The strategy aims to destock and stabilize the prices, with plans for gradual increases throughout 2024. A structural supply shortage is observed, giving chip manufacturers control over prices.
Despite the quarterly increase in prices, experts indicate that there is still a path to follow for suppliers to reach the break-even point. It is anticipated that prices will need to increase by more than 40%, and vendors are banking on future increases of at least 50% to ensure profitability.
The industry highlights that due to the lower profitability of NAND Flash Compared to DRAM, international giants are actively reducing production. However, suppliers’ tight wafer allocation strategy creates an advantage in price control.
The outlook is for strong prices in the coming quarters, with buyers facing difficulties due to shortages and expected increases. The market is waiting to see how this dynamic will develop throughout the year, with expectations of a more solid recovery in the profitability of NAND Flash suppliers.