Kioxia has publicly denied discussions regarding joint production with SK hynix, stating that closer cooperation with the rival and shareholder would face antitrust hurdles, according to TrendForce reporting on September 9, 2026. Kioxia CEO Hiroo Ota emphasized that the two companies are not discussing joint production and that Kioxia must find alternative methods to manage surging memory prices. This statement comes as memory manufacturers undertake costly capacity expansions to meet soaring demand from AI service providers, with Ota instructing sales teams not to push for significantly higher prices from data center operators to sustain AI investment appetite.
SanDisk 10-K restrictions on third-party flash
The denial of deeper cooperation contrasts with previous speculation fueled by existing ties between the two firms. Bloomberg notes that Kioxia and SK hynix are jointly developing nonvolatile magnetic memory, and Kioxia sources DRAM from SK hynix for some of its SSDs. SK hynix also holds convertible bonds that could translate into a leading 14.19% stake in Kioxia. However, Kioxia’s existing partnership with SanDisk adds significant complexity; SanDisk’s 10-K filing indicates that the two companies are restricted from manufacturing flash-based memory with third parties or producing beyond their agreed capacity, creating a legal and operational barrier to a new production tie-up with SK hynix.
Kioxia and SanDisk $31 billion Japan capex
Despite the lack of a joint venture, the industry remains focused on massive individual capacity buildouts to address persistent memory shortages. Kioxia and SanDisk plan to invest over $31 billion (approximately JPY 5 trillion) in Japan through 2032, including the continued buildout of their Yokkaichi and Kitakami plants. Meanwhile, SK hynix is investing KRW 54 trillion ($40 billion) to expand chip production in Korea and is building an advanced packaging facility in West Lafayette, Indiana. This massive capital expenditure is driven by strong demand for AI-driven storage, with enterprise SSD prices having risen around 35% in the second half of 2025 and projected to surge by a cumulative 235% in 2026.
Price stability vs. capacity expansion strategy
The denial of a joint production venture highlights a market tension between supply consolidation and competitive independence. For NAND buyers and capacity planners, this suggests that while demand pressure from AI infrastructure remains robust, the industry’s path to mitigating supply risks relies on individual, massive capital investments rather than shared manufacturing risk. Kioxia’s stated priority of achieving NAND price stability suggests the market is reaching a point where cost control is as critical as capacity expansion for sustaining AI investment. This dynamic underscores that even with high demand, the competitive landscape remains fragmented, forcing players to manage both supply chain dependencies and pricing pressures simultaneously.
50% of Kioxia volume under long-term deals
Kioxia is actively securing long-term supply commitments to stabilize its revenue base amidst this volatility. Ota noted that some of the world’s largest technology companies are already seeking NAND supply agreements extending as far as 2030. Kioxia is also close to its goal of covering 50% of shipment volume under long-term agreements. This strategic shift toward long-term contracts aligns with the broader industry trend of locking in demand for AI infrastructure, where memory capacity is a critical bottleneck for scaling large language models and inference workloads.
XL-FLASH as HBM extension for AI inference
The push for NAND price stability occurs against a backdrop of intense competition in high-bandwidth memory and emerging flash-based alternatives. While SK hynix and Samsung dominate the HBM market, with Chinese firms reportedly paying multiples of standard prices for HBM due to export controls, Kioxia is positioning its XL-FLASH technology as a complementary solution. Kioxia’s GP Series SSDs, which won ‘Best of Show’ at FMS 2026, are designed to extend HBM with a high-performance flash tier, enabling AI systems to access larger datasets without relying solely on costly in-node HBM or DRAM expansion. This architectural approach allows Kioxia to compete on value and capacity in the AI storage stack, distinct from the high-margin HBM segment (TechNews).