TrendForce sees NAND supply pressure easing in the second half of 2027

TrendForce's July NAND update says the market has remained undersupplied in 2026 because AI-related demand has been strong while capacity expansion stayed limited. The firm expects server demand to remain healthy into 2027, helped by broader deployment of AI applications, easing server CPU bottlenecks, and more stable component availability. At the same time, NAND suppliers are expected to keep increasing output mainly through process migrations and selective upgrades to existing lines rather than large new fab additions, because many manufacturers continue to prioritize DRAM capacity. TrendForce also expects Chinese suppliers to lift production as new tools come online, pushing their share of global NAND bit output to nearly 19%. On the demand side, the outlook for smartphones and notebooks remains weak, even though those categories still account for a large share of total NAND consumption. TrendForce estimates a 4% to 5% NAND supply deficit for 2026, but says the balance should turn positive in the second half of 2027, gradually reducing current supply tightness.