Market Monitor

NAND Market Monitor

By Yole Intelligence — Mar 2024

In 2024, suppliers are restricting supply with the aim of driving prices up and returning to healthier operating margin levels.

YINTM24401

Key Features

Quarterly Excel database and PDF presentation with analyst access included
Five-year market forecast for supply including fab capacity and wafer production, process & technology roadmaps, and demand by market segment, including client SSD, enterprise SSD, mobile, removable storage, automotive and consumer.
Market shares from 2015-present by supplier, region, and segment
Supplier financial data from 2015-present including revenue, ASP, operating cost per bit, and operating margin
Detailed two-year quarterly ASP forecast for key NAND components and packaged solutions

What's new

Due to a disciplined control of production capacity utilization rates by suppliers, the market is projected to remain undersupplied throughout 2024. As a result, ASP are anticipated to rise, contributing to the NAND industry's return to profitability by the second half of the year. Capex are expected to remain low, with a focus on conversion in 2024.

Product objectives

Provide a comprehensive guide to the dynamic NAND flash market, including:

Overview of current market and competitive dynamics that will shape the market in thecoming quarters/years
Impact of geopolitical issues (e.g.US/China relations) on the NAND market
Historical data that provides context for the long-term outlook: market shares, supplier profitability, capex, etc.
Current drivers of NAND and SSD demand, including by end device, memory content, and technology type
Technology trends by supplier, including roadmaps, layer count, stacking, and hybrid bonding developments
Wafer capacity evolution by supplier

NAND suppliers weathering the downturn, dawn of recovery ahead?

Look back on 2023

The NAND industry experienced its most significant decline in a decade, concluding the year on a dismal note as operating margins plummeted to nearly -50%. Revenue dropped below $40 billion, marking the industry's lowest point since 2016.
In Q4 2023, strategic production cuts from all the players began to yield results, as evidenced by a 17% pricing increase and an improved operating margin of -30%. Despite a modest 6% increase in bit shipments, these measures boosted profitability and investor confidence, demonstrating the effectiveness of the cuts.
Tensions between China and the US also cast a shadow over the year, with YMTC and Micron bearing the brunt of sanctions.

2024 outlook:

In 2024, the NAND industry is anticipated to rebound, with memory suppliers observing a cleaner demand picture free from excessive inventories.
To attain profitability, suppliers will cautiously manage capacity utilization, ensuring a slightly undersupplied market.
Key demand growth drivers stem from the consumer segment, powered by the integration of Generative AI technology into premium mobile and PC devices. This surge is compounded by the anticipated device renewal cycle, coinciding with the peak demand experienced during the COVID-19 pandemic four years ago. Furthermore, a rebound is expected in data center server demand for enterprise SSDs.

Despite turbulence in the NAND market, the long-term demand drivers remain intact

In 2023, the NAND industry experienced its lowest revenue since 2016, totaling just under $40 billion shared across six players. These players experienced their lowest operating margin of the decade.

However, the NAND market is projected to grow at a compound annual growth rate of 21% (CAGR2023-2029), driven by increased average unit contents and the cannibalization of HDDs by enterprise SSDs in data centers. Furthermore, the emergence of Gen AI is expected to contribute to increased data generation, further boosting average unit content. Mobile and SSDs are anticipated to maintain their dominance in driving NAND demand.

The monitor provides an overview of player dynamics, including market shares (bit, wafer, and revenue), NAND technologies, and process penetration. It shows historical shipments and forecasts by segment and interface for the next five years, as well as historical and projected revenue. This enables us to understand the cyclical phases of over and undersupply that influence NAND market pricing and profitability. Additionally, the Monitor covers the historical and forecast capital expenditure (capex) needed to sustain bit production growth.

Whether it's for understanding market dynamics, managing procurement, assessing equipment requirements, or monitoring production, the Monitor serves as a valuable resource.

Do you have an account?

Search

NAND Market Monitor

In 2024, suppliers are restricting supply with the aim of driving prices up and returning to healthier operating margin levels.

NAND suppliers weathering the downturn, dawn of recovery ahead?

Despite turbulence in the NAND market, the long-term demand drivers remain intact