Samsung Electronics, SK hynix, and Micron and Kioxia, cited alongside them as the world's top four in NAND flash, have recently taken aggressive steps in capital spending. Kioxia plans to ramp up NAND flash production this year, while Micron recently unveiled a 10-year plan to expand cleanroom space at its Singapore production base by 700,000 square feet (about 65,000 square meters). In addition, China's YMTC is strengthening its foothold in the global market, with suppliers expanding their production capacity.
According to the industry on the 29th, the aggressive investment moves by Micron and Kioxia are emerging as a variable that could worsen NAND profitability in the downturn after demand for artificial intelligence (AI) ends. For now, demand is surging for high-capacity, high-performance solid-state drives (SSD) due to AI infrastructure expansion, making high-density NAND production capacity essential to support it, but there are concerns that broad-based oversupply could follow once supply and demand begin to align.
In Japan, Kioxia is increasing the deployment of production facilities to maximize the profitability of its NAND business during the memory supercycle. Unlike Samsung Electronics or SK hynix, Kioxia does not operate a DRAM business, allowing it to actively pursue NAND expansion investments. In a recent interview, Kioxia Executive Vice President Watanabe Tomoharu said, "We are confident the market will continue to maintain a rapid pace of expansion," and noted, "We are making new factory investment decisions every month to meet rising demand without disruption."
Kioxia has begun full-scale operations of the second fabrication plant (fab) at its Kitakami flash memory plant in Iwate Prefecture, and plans to mass-produce and supply cutting-edge memory chips to the market starting in the first half of this year through this facility. Along with the Kitakami plant, the company is also making large-scale investments at its main production base in Yokkaichi, Mie Prefecture, to build production capabilities.
Micron's new NAND plant is expected to begin operations in 2028. The newly released plant will be built right next to the $7 billion (about 10 trillion won) HBM (high-bandwidth memory) packaging complex released last year. Micron is also building four plants in Clay, New York, as a long-term project, investing $100 billion (about 143.6 trillion won), four times the size of Singapore.
Samsung Electronics, the world's No. 1 in the memory market, appears somewhat cautious about increasing NAND production, and SK hynix is concentrating capital spending on DRAM and high-bandwidth memory (HBM) rather than NAND. This is seen as a strategic choice to boost profitability centered on NAND used in SSDs for AI data centers. In contrast, Kioxia plans to increase production to 4.82 million wafers this year from 4.71 million last year to actively respond to the "AI-driven boom."
In the semiconductor industry, a key reason Samsung Electronics and SK hynix are not moving aggressively to expand NAND output is that, while beneficial in the short term, it could pose medium- to long-term risks. A source familiar with Samsung Electronics said, "Looking at past precedents, even if the NAND market looks good for now, there are many suppliers and concerns remain over China-made NAND," adding, "If the market turns down later, there is a risk of large losses during a slump."
Market research firm TrendForce said, "The expansion of capital expenditures by major NAND companies such as Kioxia and Micron is driven by a combination of factors, including increasing demand for AI infrastructure, expectations of a recovery in market prices, and technology transitions to strengthen competitiveness," and explained, "This is based on the view that NAND demand will continue with AI memory, but price competition is likely to intensify in an oversupplied phase."