Storage is booming! Kioxia's production capacity has been fully sold out this year

The strong demand brought about by the artificial intelligence boom is reshaping the global storage market landscape, marking the end of the era of cheap solid-state drives (SSDs). According to media reports on January 22, Japanese storage chip giant Kioxia confirmed that due to the "extreme thirst" for AI demand, the company's production capacity for this year has been completely sold out, and the supply shortage is expected to continue until 2027.

According to Tom's Hardware, citing South Korean media Digital Daily, Shunsuke Nakato, Managing Director of Kioxia's storage business division, clearly stated at a conference in Seoul that the days of 1TB SSDs priced around 7,000 yen (approximately $45) are long gone. Since the end of 2023 to early 2024, it has been difficult to find 1TB SSD products priced below $50 in the market, marking a structural shift that signifies the end of the low-price storage cycle.

The supply-side shortage has quickly transmitted to end-user prices, causing a surge in prices for both consumer-grade and enterprise-grade storage products. Market data shows that the prices of some mainstream SSD models have increased by more than 130% in the past few months. Even in the entry-level SATA SSD market, the starting price has significantly risen to around $73, more than 50% higher than the low point in 2023.

Kioxia executives pointed out that faced with a backlog of orders, the company cannot arbitrarily accelerate delivery through physical means, forcing manufacturers to adjust their allocation strategies. This statement aligns with observations from other major players in the industry, highlighting the severe supply-demand imbalance challenges facing the global NAND flash supply chain amid the capacity squeeze from AI infrastructure construction.

Price Surge Across All Products

Market data shows that the price increase of 1TB SSDs has covered the entire spectrum of products from traditional SATA drives to the most advanced PCIe 5.0 models. For investors and consumers who have long been focused on PC hardware, the "golden period" of 2023, when 1TB drives were priced below $50 and even touched a low of $35, has become history.

According to a price list compiled by Tom's Hardware, mainstream product prices experienced dramatic fluctuations between late 2025 and early 2026. Among them, the price of the Corsair MP700 Pro XT 1TB rose from $159.99 in November 2025 to $219.99 in January 2026, an increase of 38%. The price increases for PCIe 4.0 and PCIe 3.0 products were even more astonishing, with the price of the Samsung 990 Pro 1TB rising by 83% to $199.99; the price of the WD SN700 1TB surged by 132%, reaching $299.99. Even the older Samsung 870 Evo 1TB saw its price rise by 51% compared to a few months ago.

Shunsuke Nakato believes that this upward price trend will continue through 2026 and may extend into 2027. This means that for users planning system builds or storage upgrades, the low-cost window has already closed.

Trust-Based Allocation Strategy

As a NAND manufacturer, Kioxia did not choose a simple "highest bidder wins" strategy to respond to this shortage. Shunsuke Nakato revealed that the company adopted a "gentleman's agreement" model based on trust and long-term partnerships to allocate production capacity.

Shunsuke Nakato explained that it is physically impossible to arbitrarily accelerate delivery or increase production just because orders are piling up. Therefore, Kioxia did not auction off the scarce NAND resources to the highest bidder, nor did it adopt a first-come, first-served mechanism. Instead, it chose to negotiate annual supply plans with long-term partners and distribute accordingly. This unconventional allocation strategy aims to maintain the long-term stability of the supply chain rather than maximize short-term profits.

Industry Capacity and Technological Response

In the face of ongoing supply tightening, storage manufacturers are enhancing output efficiency through technological means. Shunsuke Nakato stated that Kioxia's factory in Yokkaichi is utilizing AI and Internet of Things (IoT) technologies to collect approximately 50TB of manufacturing data daily to maximize yield. Meanwhile, the Kitakami factory is expected to soon begin full production of Kioxia's 8th generation BiCS (BiCS8) flash memory, which is hoped to provide some relief to the global NAND supply shortage.

However, the overall market situation remains severe. Other industry giants, in addition to Kioxia, have also sent similar signals. The CEO of Phison confirmed that NAND prices have doubled, and all production for 2026 has already been sold out. Furthermore, media reports indicate that SanDisk has also raised flash memory prices by 50% to cope with the surge in demand driven by AI. As the AI boom forces brands like Transcend to delay the delivery of SSDs and flash memory products, the seller's market characteristics in the storage industry will become increasingly evident in the coming years