TrendForce reports that the oversupply is placing financial strain on NAND flash suppliers, leading to a downward revision of growth forecasts from 30 per cent to 10-15 per cent for 2025.

“NAND flash manufacturers have adopted more decisive production cuts, scaling back full-year output to curb bit supply growth. These measures are designed to alleviate market imbalances swiftly and lay the groundwork for a price recovery,” TrendForce stated.

Gartner director analyst and technology product leader Shrish Pant thinks NAND flash pricing will be weak in the first half of 2025, though higher SSD bit shipments may emerge in the latter half due to AI server demand.

“Vendors are working tirelessly to discipline supply, leading to prices recovering in the second half of 2025. In the long term, AI demand will continue to drive the demand for higher-capacity/better-performance SSDs,” Pant said.

The cyclical nature of the memory market means NAND flash prices fluctuate depending on hyperscaler purchasing trends. A LinkedIn post by memory distributor Memphis Electronic noted that flash memory prices have declined for four consecutive months due to decreased purchases from smartphone and laptop manufacturers.

Korean memory giant SK hynix highlighted market difficulties during an earnings call last year, noting that despite solid enterprise SSD demand, bit growth for NAND sales declined by mid-teen per cent sequentially due to weaker procurement from PC and mobile customers.

Micron echoed similar concerns in its Q4 2024 earnings call, lowering its NAND bit demand growth expectations for 2024 and 2025. The company cited weaker consumer NAND shipments, inventory adjustments, and a temporary slowdown in datacenter SSD purchases as key factors.