The NAND flash market remains undersupplied at the halfway point in 2026, driven by AI demand and limited capacity expansion, but things may be steadying into 2027, according to market research firm TrendForce.
The ongoing NAND flash shortage due to server demand, particularly among data center expansion, is likely to stay strong throughout 2026 and into 2027. But flash vendors are undergoing process migrations and steadily growing bit output. This combined with weak demand in consumer electronics is likely to restore market balance in the second half of 2027, TrendForce said.
For the remainder of 2026, NAND flash vendors will continue to rely on process node migrations to meet rising demand with fab space remaining constrained and as manufacturers continue prioritizing dynamic random-access memory (DRAM) capacity expansion. These will continue to be challenges in 2027, TrendForce said.
TrendForce forecasts that the NAND flash market will see a 4% to 5% supply deficit for the remainder of 2026, resulting in continued shortages. But this supply-demand balance will turn positive in the second half of 2027, easing supply issues.
This improvement is coming from vendors in Korea, the U.S. and Japan, who are continuing to upgrade production lines while Chinese suppliers are expected to see a significant boost in production as new equipment comes online in 2027. This will ultimately raise China’s NAND flash bit output to nearly 19%, according to TrendForce.
Meanwhile, Intel and AMD are accelerating server platforms in the second half of 2026, which will sustain demand for general-purpose servers. This, combined with improvements in component availability, is expected to remove bottlenecks to system production. This will also push server shipment growth even further in 2027.
While servers now account for more than 40% of total NAND flash bit demand, smartphones and notebooks still represent 40% of overall NAND demand. The consumer market still plays a significant role in the overall NAND flash market conditions, TrendForce said.
The consumer market will determine the overall availability of flash memory for other sectors.
