For several years, NAND has sat quietly in the background of most designs. It rarely forced difficult tradeoffs, and even during volatile DRAM cycles, storage tended to absorb the impact without disrupting product planning. That assumption is starting to slip. In a new Fusion Worldwide article examining conditions heading into 2026, the company points to early signs that NAND is moving into a more constrained position. What stands out is that the pressure is not coming from a single shock event, but from the slow accumulation of structural choices that are now running headfirst into rising storage demand.
The shift matters because storage has become tightly linked to AI infrastructure. As accelerators grow more capable, their supporting systems lean heavily on high capacity SSDs. Those requirements are increasing faster than many teams expected. At the same time, several of the largest NAND suppliers continue to run production at deliberately restrained levels. When those two forces meet, the market behaves very differently from the stable pattern engineers have been used to.
Where Production Restraints Meet Growing AI Storage Loads
A common challenge across memory planning is that supply responses rarely track demand curves. NAND illustrates that clearly. Samsung and SK Hynix, which account for a significant share of global output, are entering another year of reduced wafer starts. The reductions are not dramatic on their own, but they apply pressure precisely when enterprise SSD requirements are climbing. In practice, this combination limits downstream flexibility and narrows the range of acceptable substitutes. Mobile and consumer platforms begin to feel the effect first because they depend on consistent pricing. AI servers absorb available capacity long before it reaches those markets.
Why NAND Pricing Now Resembles DRAM Cycles
One detail worth noting is how NAND pricing behavior is inching closer to DRAM. As AI deployments scale, storage demand grows nearly in lockstep with compute density. Enterprise SSDs become the gravitational center of the supply chain, pulling capacity away from lower margin categories. Analysts expect NAND prices to climb by more than a third during the first quarter of 2026. Supply growth, meanwhile, is projected to sit well below the long term trend. This matters because it reframes NAND from a background commodity into something with real planning weight. Teams who once viewed it as predictable are now beginning to track it as a potential bottleneck.
Structural Factors Keeping NAND Behind Other Priorities
Despite strengthening demand signals, NAND remains second in line behind DRAM for capital allocation. DRAM, and especially HBM, delivers higher margins and absorbs more investment. At the same time, the broader push toward QLC introduces yield volatility as suppliers refine production. Effective output drops even when wafer starts appear steady. Several manufacturers are also holding firm on disciplined production as a strategy to stabilize pricing and protect margin against lower cost competitors. For engineers, the result is a supply environment shaped intentionally rather than one responding to traditional cyclic patterns.
Downstream Device Behavior Shows The First Practical Signs
The downstream effects are already visible. Devices that were expected to increase base storage configurations are holding their current levels. Entry level laptops are shifting to smaller or slower drives to keep pricing stable. In real systems, this forces design teams to make harder choices about performance headroom and lifecycle expectations. The familiar year on year rise in capacity is no longer guaranteed.
Access Is Splitting Into Two Distinct Buyer Tiers
As supply tightens, terms are beginning to reflect that imbalance. Some NAND suppliers are requesting full cash prepayment on long duration agreements. This transfers financial exposure from suppliers to customers and limits flexibility if requirements change. Large cloud providers and top tier OEMs can absorb these terms with relative ease. Smaller buyers face reduced leverage and less visibility. The market effectively splits into groups with very different access conditions.
What Teams Should Plan For Through 2026
New NAND capacity takes time to build, which means meaningful relief is unlikely before late 2026 or early 2027. Until then, tight utilization, selective allocation, and firmer pricing are expected to remain in place. For hardware teams, procurement groups, and anyone planning storage dependent products, the takeaway is that NAND is shifting from a reliable constant to a variable that can influence design timing, configuration choices, and long term sourcing strategies.
You can read Fusion Worldwide’s full analysis on tightening NAND supply for 2026 at www.fusionww.com
Image credit: Fusion Worldwide
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