The price of enterprise solid-state drives (SSDs) has surged by over 80%, driven by a spike in orders for AI server expansion. In response, SK Hynix and its subsidiary Solidigm—a leading provider of innovative NAND flash memory solutions—are ramping up NAND flash production. The AI boom, which initially fueled demand for high-bandwidth memory (HBM), is now extending to enterprise SSDs. As the volume of data stored on AI servers rapidly increases, IT companies are scrambling to secure high-capacity SSDs, with some even paying above-average prices to ensure supply. Consequently, SK Hynix and Solidigm are expected to prioritize scaling up production of large-capacity SSDs utilizing quad-level cell (QLC) technology, tailored specifically for enterprise use.

Industry insiders revealed on Aug 19. that SK Hynix is gradually increasing wafer input at its M15 production line in Cheongju, with the goal of boosting monthly wafer output by approximately 10% early next year. Meanwhile, Solidigm, buoyed by strong SSD demand, turned a profit in the second quarter and plans to increase production by around 5% starting early next year.

SSDs, which surpass traditional hard disk drives (HDDs) by using NAND flash to store data, enable fast data read/write operations. As AI server data storage needs soar, high-capacity SSDs have become indispensable. Market research firm TrendForce explained that in AI model training, SSDs not only store parameters (learning values) but also create checkpoints that periodically save progress, allowing recovery from specific points in case of interruptions. The firm also noted that AI servers are expected to drive an annual growth rate of over 60% in SSD demand over the next few years.

In the server industry, QLC-based large-capacity SSDs are gaining traction. QLC technology stores 4 bits of data per cell—one more than TLC, which stores 3 bits—allowing more information to be stored per unit area, reducing power consumption, and offering faster data read/write speeds. This makes QLC ideal for producing ultra-high-capacity enterprise SSDs.

Currently, only Solidigm and Samsung Electronics produce QLC-based large-capacity SSDs. Solidigm leads the market with its 60-terabyte (TB) QLC enterprise SSDs. An industry expert noted that Solidigm’s QLC-based SSDs are optimized for ultra-high-capacity server storage and have advantages over competitors in areas like controller compatibility. Demand has significantly exceeded supply since the second quarter.

SK Hynix plans to strengthen its market leadership by mass-producing new products with capacities expanded to 128TB, following the release of 60TB QLC models, early next year. Kim Seok, SK Hynix’s NAND marketing director, stated during the company’s second-quarter earnings call, “Last year, we minimized investments in NAND flash, and we are gradually increasing production this year after output reductions. We are focusing on areas with rising demand.” He added, “We expect enterprise SSD product sales to account for nearly half of our total NAND revenue, and we aim to solidify our position as one of the top two players in the rapidly growing enterprise SSD market.”