Despite continued upward momentum in memory contract prices, smartphone brands are maintaining healthy inventory levels to manage cash flow risks. On the market front, robust AI server demand has prompted Korean and US suppliers to tighten full-year allocations for smartphone clients, leaving consumer supply constraints unlikely to ease in the near term. Korean suppliers' 2Q26 quotes for LPDDR4X, LPDDR5X, and UFS remain sharply elevated, though the pace of price hikes is expected to moderate in 2H26. Elevated costs are eroding brand profitability and pushing up retail prices, with global smartphone production projected to decline over 10% YoY in 2026. Under this pressure, brand strategy divergence is intensifying, and significant shifts in market share are anticipated this year.
As AI server platforms advance, power architectures evolve into multi-track systems, and cooling accelerates toward full liquid solutions. Delta and LiteOn capture cloud service provider and new platform demands with diverse, high-power architectures, aggressively expanding localized capacity. AVC and Sunon accelerate into system-level liquid cooling integration, driving growth amid computing upgrades.
US-Iran stalemate and rising inflation weaken consumer electronics demand, while AI server and data center investments remain the core driver for tech sector growth, creating a differentiated supply chain with stronger high-end component demand.
Driven by the explosive demand for AI servers and high-capacity solid-state drives (SSDs), the NAND industry's quarterly revenue has reached a record high. Under the dual impact of limited capacity and traditional hard drive shortages, the soaring prices of enterprise products have boosted manufacturers' profits. Looking ahead, major suppliers are actively advancing high-capacity technologies, and the trend of undersupply and high prices is expected to persist in the long term.
Weak consumer demand stalls flash markets, pressuring prices. Conversely, robust AI server demand drives Samsung's profit surge. Future strategies focus on advanced processes and large-capacity enterprise SSDs to address severe supply shortages and transition to high-value markets.
