The Q1 NAND market remains over-supplied leading to sustained price declines and financial strain for suppliers, says TrendForce, but supply and demand will be closer to balance in Q2.

Contributing to the shift will be: production cuts by manufacturers; inventory reductions in the smartphone sector, and growing demand driven by AI and DeepSeek applications. 

These are expected to deliver a price rebound for NAND Flash in Q3.

 

China’s  trade-in subsidy policies, implemented in 4Q24, have also stimulated smartphone sales and accelerated depletion of NAND Flash inventory. 

As price declines slow down, smartphone makers may seize the opportunity in 2Q25 to build low-cost inventories to further drive demand.

NVIDIA is set to ramp up shipments of its Blackwell-series products in the latter half of the year which is expected to significantly boost enterprise SSD demand. 

DeepSeek’s effect in reducing AI server deployment costs will empower SMEs to integrate AI more effectively. 

SSDs with capacities exceeding 30TB are projected to become the preferred storage solution for SMEs due to their superior performance and TCO benefits, thereby driving enterprise SSD demand..

Furthermore, DeepSeek’s breakthroughs in reducing requirements for computational power are likely to accelerate the adoption of AI-enabled smartphones.

Coupled with the increasing penetration of QLC  technology in mobile devices, AI smartphone storage demand is projected to grow.