In November 2025, the storage industry experienced another wave of disruption. According to public reports, flash memory giant SanDisk announced a significant increase in NAND flash contract prices for November, with a rise of up to 50%. This news immediately attracted the attention of the entire storage supply chain and led the industry to reconsider future market trends. It is worth noting that this is at least the third price increase by SanDisk this year. Earlier, in April and September, SanDisk raised prices for its full range of products and consumer products by 10%, respectively. This time, the increase is not only much larger but also far exceeds the previously expected 5%-10% rise, signaling that the storage market has entered a new tight cycle.
AI Data Centers and Large-Capacity Storage Drive Prices Up
Behind this price hike is primarily the rapid growth of AI and data center business. In recent years, generative AI, large-scale inference, and training tasks have caused an exponential increase in storage demand, especially for NAND flash. Compared with traditional hard disk drives (HDDs), NAND flash offers higher read and write speeds and lower latency, making it very suitable for AI model training and inference that require high concurrency data access. As large models and big data applications expand, data centers demand ultra-large SSDs, and many companies even rush to purchase 122TB and 245TB nearline SSDs to replace some HDDs, ensuring performance and throughput. This sharp rise in demand has rapidly depleted manufacturers’ inventories, further tightening the supply-demand balance.
Moreover, AI-driven data center growth is not limited to high-end servers. Consumer and enterprise-level applications are also increasing storage needs. High-performance laptops, gaming consoles, and industrial embedded devices all require high-capacity, high-speed flash memory, further expanding overall NAND demand. Industry analysts point out that the growth in storage demand driven by AI data centers is a key structural reason behind the current shortage in the market.
Supply-Side Constraints and Price Pressure
The supply side is another key factor driving this price increase. In recent years, many storage manufacturers have gradually reduced the production capacity of older NAND processes while prioritizing high-end 3D NAND and HBM products to improve profit margins. This trend has led to persistent shortages of low-capacity and legacy NAND. At the same time, complex production processes and limited wafer capacity make it difficult to quickly increase output in the short term. Inventories remain low, forcing manufacturers to raise prices when facing strong demand.
SanDisk’s decision to increase prices comes directly from this supply-demand imbalance. Industry reports indicate that SanDisk’s 50% price hike is a direct response to market shortages and reflects management’s view that market prices may continue to rise. Compared with the 10% increases in April and September, this adjustment is not only larger but also highlights the company’s strong attention to short-term supply gaps.
Responses from Downstream Companies and the Supply Chain
SanDisk’s sharp price increase naturally triggered reactions across the storage supply chain. Module manufacturers such as Transcend, Innodisk, and Apacer Technology have chosen to pause shipments and reassess pricing. This move shows that downstream companies must adjust their procurement strategies to avoid delivering at low prices and losing profit. Transcend even stated that from November 7, it would suspend quotations and shipments, citing “expectations that the market will continue to improve,” implying that NAND prices could rise further.
At the same time, other storage giants have also followed with price increases. Samsung Electronics, Micron, and others have raised DRAM and NAND contract prices, creating a clear upward trend in the storage market. Originally, the industry expected NAND prices to rise about 5%-10% in the fourth quarter, but SanDisk’s 50% hike far exceeded expectations and forced downstream companies to adjust their sales strategies. The market is now showing a pattern of “price rises first, stability later.”
Impacts on End Markets and Downstream Companies
In the short term, the significant price increase for NAND flash greatly increases cost pressure for downstream companies. SSD manufacturers, server integrators, and consumer electronics companies may have to pass the higher costs on to end products, resulting in rising prices for SSDs, laptops, servers, and other devices. Some companies may try to mitigate cost pressures by ordering early or stocking up, but inventory accumulation and longer delivery cycles remain unavoidable challenges.
On the other hand, for storage chip manufacturers, the price increase clearly provides an opportunity to improve profits. Companies like SanDisk, Samsung, and Micron are expected to see their average selling prices (ASP) and profit margins rise in tandem with the price increase. This is one reason why the stock market remains optimistic about these companies. Analysts have already raised SanDisk’s stock price targets, citing its strengthened pricing power in the NAND market.
Conclusion
Structurally, this price hike is not only the result of short-term market fluctuations but also reflects deeper adjustments in the storage market. Factors such as AI data center growth, large-capacity SSDs replacing HDDs, 3D NAND process upgrades, and process migrations are pushing NAND flash prices into a new high range.
SanDisk’s significant increase in NAND flash prices in November is the inevitable result of AI-driven demand and market tightness, marking a new high-volatility cycle in the storage market. In the coming months, price changes in the storage market will remain a key focus, with AI development pace and wafer capacity expansion directly determining the duration and depth of this price uptrend.
