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The NAND flash memory market is also feeling the impact of this trend, driven by the demand for high-bandwidth memory (HBM) in artificial intelligence (AI) related semiconductors.

Currently, competition in the NAND flash memory market is intensifying, with storage giants Samsung and SK Hynix stepping up their efforts to enhance the performance and capacity of NAND products.

01

The two giants take turns to make moves

Samsung starts mass production of the ninth generation V-NAND flash memory

In April of this year, Samsung announced that its ninth generation V-NAND 1Tb TLC product has begun mass production, which will help to consolidate its outstanding position in the NAND flash memory market.

So what is V-NAND flash memory?

As we all know, planar NAND flash memory is not only divided into SLC, MLC, and TLC types, but also to further improve capacity and reduce costs, the process technology of NAND is continuously advancing. Although more advanced process technology brings larger capacity, while the capacity is increased and the cost is reduced, the reliability and performance are declining. For example: with the continuous innovation of process technology, the interference phenomenon between NAND cell units is becoming more and more serious.Samsung's V-NAND no longer pursues the reduction of cell units but instead encapsulates more cell units through 3D stacking technology to achieve the goal of increasing capacity.

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In 2013, Samsung released the world's first V-NAND flash memory and put it into mass production, marking the transformation of 3D NAND flash memory from a technical concept to the commercial market. Now, this technology has been iterated to the ninth generation.

Compared with the eighth generation V-NAND, the storage density per unit area of the ninth generation V-NAND has increased by about 50%, thanks to the industry's smallest cell size and the thinnest mold layer. To improve product quality and reliability, Samsung has adopted new innovative technologies, such as avoiding cell interference and extending cell life, while the cancellation of spare channel holes has greatly reduced the planar area of the storage unit.

The ninth generation V-NAND uses a new generation of Toggle 5.1 flash memory interface, which increases the data transmission speed by 33%, up to 3.2Gbps. The new interface can provide sufficient performance bandwidth for the latest PCIe 5.0 SSD. Compared with the previous generation, the ninth generation V-NAND also has improvements in low power design, with a power consumption reduction of 10%, making the SSD more energy-efficient.

Currently, Samsung has started large-scale production of 1Tb TLC ninth generation V-NAND, and will launch QLC models in the second half of this year.

SK Hynix develops the next-generation mobile terminal NAND flash memory solution "ZUFS 4.0"

In May this year, SK Hynix announced that the company has developed a mobile terminal NAND flash memory solution product for on-device AI, ZUFS (Zoned UFS) 4.0.

SK Hynix said: "ZUFS 4.0 is a new generation of mobile terminal NAND flash memory solution products, which achieve the highest performance in the industry and are optimized for on-device AI mobile phones."

ZUFS manages data generated by smartphone applications according to the characteristics of each data. Unlike the existing UFS, which stores data in a mixed manner without areas, ZUFS can store data for different purposes and usage frequencies in different partitions (Zones), improving the operating speed of the mobile phone operating system and the data management efficiency of the storage device.

As a result, ZUFS has improved the running time of mobile phone applications by about 45% compared to the existing UFS in the long-term use environment. Moreover, ZUFS has achieved more than four times the improvement in storage read and write performance, thereby extending the product life by about 40%.Hynix provides customers with initial trial products, and based on the specifications of these products, collaborates with customers to develop 4.0 products that meet JEDEC standards. The company will start mass production of ZUFS 4.0 products in the third quarter of this year.

In fact, since the advent of the 3D era for NAND flash memory, the number of chip layers has always been a focal point of competition among major NAND flash memory chip manufacturers, with the number of stack layers increasing. In the competition of 3D NAND technology, storage manufacturers have evolved from the initial 24 layers, 32 layers to 128 layers, 176 layers, and even more than 200 layers. Against this backdrop, each storage manufacturer has different bets, let's take a look at the development routes of each company.

02

Just rolling to 200 layers? Why do each company's technical routes differ?

According to a previous report by TomsHardware, Samsung is preparing to release the 9th generation V-NAND technology products, which have reached 280 layers, a further improvement compared to the 236 layers of the 8th generation V-NAND technology. Samsung's technical route is to choose the V-NAND architecture.

Hynix 321-layer NAND plan to start mass production in the first half of 2025

Hynix first showcased the world's first 321-layer NAND flash memory at the 2023 Flash Memory Summit held in Santa Clara, USA in August last year.

Hynix's technical route is to choose 4D stacking. It is worth noting that Hynix's 96-layer NAND flash memory developed in 2018 has surpassed the traditional 3D method and introduced the 4D method.

The traditional 3D NAND architecture consists of stacked NAND arrays and peripheral circuits. In most designs, the peripheral circuits are placed next to the 3D NAND array, which occupies the die area and ultimately limits the number of areas available for memory itself. Hynix has transferred the peripheral circuits that were previously placed next to the storage cells to below the storage cells, reducing the chip's occupied space. And it is called 4D NAND.Compared to 3D methods, 4D architectures have the advantages of smaller unit area and higher production efficiency.

The efficiency of 321-layer 1Tb TLC NAND has increased by 59% compared to the previous generation of 238-layer 512Gb. This is due to the fact that data storage units can be stacked in greater single-wafer quantities to higher levels, achieving larger storage capacity on the same chip, thereby increasing the output of chips per wafer.

The person in charge of SK Hynix said, "Based on the technical experience accumulated in the mass production of the highest-level 238-layer NAND, the company is orderly developing 321-layer NAND." It is worth noting that as early as 2022, SK Hynix had successfully developed 238-layer 4D NAND flash memory.

As the first company in the industry to announce specific development progress of more than 300 layers of NAND, SK Hynix announced that it will further improve 321-layer NAND flash memory and plans to start mass production in the first half of 2025.

Kioxia and Western Digital announced the launch of 218-layer 3D NAND flash memory

In March last year, Kioxia and Western Digital announced the launch of 218-layer 3D NAND flash memory. This flash memory uses four planes of 1Tb triple-level cell (TLC) and quad-level cell (QLC), and through innovative horizontal shrinkage technology, the bit density has been increased by more than 50%. Its NAND I/O interface speed exceeds 3.2Gb/s, which is a 60% increase compared to the previous generation, coupled with a 20% improvement in write performance and read latency, which will accelerate the overall performance and availability for users.

At the product launch, Kioxia Chief Technology Officer Masaki Momodomi said, "I am very pleased to have successfully launched the eighth-generation BiCS FLASH with the highest bit density in the industry through unique engineering cooperation with Western Digital. Samples have been provided to some customers, and it will be used in the future for a series of data-centric applications, including smartphones, IoT devices, and data centers."

Kioxia chose the BiCS architecture, which was a concept proposed by Kioxia in 2007. In addition, Western Digital and Kioxia have also developed a new CBA technology, which is to directly bond CMOS on the array, and each CMOS wafer and cell array wafer is independently manufactured using the most suitable technology process, and then bonded together, thereby greatly improving storage density and I/O speed.

Micron announced that 232-layer QLC NAND is now in mass production

In April this year, Micron announced that its 232-layer QLC NAND is now in mass production and has been shipped in some Crucial solid-state drives (SSDs). At the same time, Micron's 2500 NVMe SSD has also been mass-produced for enterprise-level storage customers and has been sampled to PC OEM manufacturers.Micron's 232-layer QLC NAND offers unparalleled performance for mobile devices, client devices, edge, and data center storage devices, with its main advantages including: industry-leading storage density, which is up to 28% higher than the storage density of competitors' latest products; industry-leading 2400 MT/s NAND input/output (I/O) speed, which is 50% faster than the previous generation; a 24% improvement in read performance compared to the previous generation; and a 31% improvement in programming performance compared to the previous generation.

03

1000 layers may not be the end

Adding the number of active layers in 3D NAND devices is currently the best way to increase the density of flash memory recording, so all 3D NAND manufacturers are striving to introduce new process nodes every 1.5 to 2 years to achieve this goal.

Although the current competition mainly focuses on around 200 layers, 200 layers are far from the end. In the past two years, some giants have started to aim at 3D NAND with 1000-layer stacking.

At the 2023 IEDM conference, Samsung Electronics predicted that in the near future, the number of stacked word lines will exceed 1,000 layers, and they are also developing technology with the goal of achieving 1,000 layers.

Samsung said that the speed of 3D NAND flash memory layers is growing exponentially. Initially, it took about five generations to reach 100 layers. For Samsung, the 5th generation (V5) has 92 layers, and the 6th generation (V6) has 128 layers. However, starting from the 6th generation (V6) of 128 layers, it only took two generations to add 100 layers. For example, the 8th generation (V8) has up to 236 word line layers. This means that the 8th generation stacked 108 layers on top of the 6th generation.

If this rate continues, the 9th generation (V9) will reach more than 300 layers, the 10th generation (V10) will reach 430 layers, and the 11th generation (V11) will reach 580 layers. Now, Samsung is actively working on exceeding 1,000 layers of stacked word lines for the V13 generation.

In addition, other storage manufacturers are also continuously striving for higher layer count NAND Flash. After Micron's 232 layers, they plan to launch higher layer count products such as 2YY, 3XX, and 4XX; Kioxia and Western Digital are also actively exploring 3D NAND technology with more than 300 layers, 400 layers, and 500 layers.Recently, Hidefumi Miyajima, the Chief Technology Officer of Kioxia, also stated at the 71st Spring Meeting of the Applied Physics Society held at the University of Tokyo that they plan to start mass production of 3D NAND flash memory chips with more than 1000 layers by 2031.

It should be noted that 1000-layer NAND is not that easy to make.

In theory, stacking more than 1000 layers of NAND is feasible, but the deposition and etching issues during the stacking process need to be resolved.

Specifically, in the development process of 2D NAND, lithography technology is the key process that drives its development, while 3D NAND is completely different, with storage cells stacked vertically to increase capacity.

Bart van Schravendijk, Chief Technology Officer of Lam Research's dielectrics, said that when 3D NAND is stacked to 96 layers, the actual number of deposited layers has already exceeded 192 layers, among which, the uniformity of the silicon nitride layer will become a key parameter affecting device performance.

In addition, the most difficult part of the 3D NAND process is the etching process with high aspect ratio requirements. In the 3D NAND structure, it is necessary to etch tiny circular channels from the top to the bottom of the device through the etching process to connect the storage cells vertically.

Lam Research said that for a 96-layer 3D NAND wafer, the etching aspect ratio is as high as 70:1, and each wafer must have one trillion such tiny channels, which must be parallel and orderly. As the number of stacked layers increases, the difficulty of the etching process will gradually increase.

This also means that if the number of stacked layers exceeds 1000 in the future, chip manufacturers may face increasingly complex and expensive processes. At that time, the storage industry needs to find new solutions to continuously meet people's growing storage needs. Of course, this may also be a new type of storage medium. Major manufacturers are also well aware of this and are actively investing in research and development, such as FeRAM, MRAM, PCM, RRAM, etc. However, which device can stand out and become the next generation of non-volatile storage devices still needs time to answer.

04

What does higher NAND bring?The more stacking layers of NAND chips, the main performance benefits include increased storage density, improved read and write speeds, enhanced input-output efficiency, reduced power consumption, and reduced physical space occupation. These series of advantages are particularly important for miniaturized, high-performance mobile devices and solid-state drives (SSDs) and other products.

For the NAND industry, NAND flash memory storage itself is in the AI ecosystem chain, and any data cannot operate without an SSD, so the rise of large models will objectively trigger the demand for NAND.

With the increase in the number of stacking layers, there is no doubt that it will achieve an increase in capacity and a reduction in unit cost, and the price of SSDs will also decline accordingly.

05

The current moment, the NAND flash memory outlook is very good

Since the fourth quarter of 2023, the storage industry environment has improved significantly, downstream market demand has recovered, and the sales volume of storage products has also achieved a significant year-on-year increase.

According to the latest research report by TrendForce, due to the increased adoption of Enterprise SSDs by AI servers since February, large-capacity SSD orders have begun to emerge, combined with PC and smartphone customers continuously increasing inventory reserves due to rising prices, driving the NAND Flash volume and price to rise in the first quarter of 2024, with a 28.1% increase in revenue, reaching 14.71 billion US dollars.

The biggest change in this quarter's ranking is that Micron surpassed Western Digital to rank fourth. The main reason is that Micron's price and shipment volume in the fourth quarter of 2023 were slightly lower than other competitors, so the first quarter's revenue growth rate of 51.2% is the highest, reaching 1.72 billion US dollars.Samsung has benefited from continuous inventory replenishment by consumer-grade buyers and the recovery of Enterprise SSD orders. In the first quarter, its revenue increased by 28.6% quarter-on-quarter, reaching $5.4 billion, maintaining its leading position in the market. In the second quarter, thanks to the expansion of Enterprise SSD shipment momentum, despite the more conservative order momentum for consumer-grade products, Samsung's revenue in the second quarter is expected to grow by more than 20% due to the continuous rise in NAND Flash contract prices.

SK Group has benefited from strong order momentum in smartphones and servers, driving a 31.9% increase in revenue in the first quarter, reaching $3.27 billion. With Solidigm's unique Floating Gate QLC technology, the order momentum for large-capacity Enterprise SSDs continues to be strong. In the second quarter, SK Group's shipment bit growth is expected to be better than other suppliers, with an estimated 20% increase in revenue.

Kioxia was still affected by the production reduction strategy in the fourth quarter of last year, with a shipment bit increase of only 7% in the first quarter. However, thanks to the rise in the average price of NAND Flash, the revenue in the first quarter increased by 26.3% quarter-on-quarter, reaching $1.82 billion. In the second quarter, with the gradual increase in supply bits and providing customers with more flexible bargaining space, Kioxia is expected to further expand the shipment of Enterprise SSDs, with an expected revenue growth of about 20% in the second quarter.

Western Digital has been affected by the significant shrinkage of retail market demand since February this year, affecting the performance of shipment bits. However, it also benefited from the rise in NAND Flash contract prices, driving a 2.4% increase in Western Digital's revenue in the first quarter, reaching $1.71 billion. It is worth noting that in the second quarter, due to the overall consumer market not yet warming up, coupled with a conservative outlook for PCs and smartphones for the whole year, Western Digital wants to accelerate the development of Enterprise SSD products to expand future growth momentum. However, the long verification period for enterprise-level products limits the growth of short-term shipment momentum, and it is expected that Western Digital's revenue in the second quarter may be flat.

Looking at the second quarter trend, the inventory levels of NAND Flash for PC and smartphone customers are already high, and the growth of consumer terminal orders this year is still not better than expected, and brand buyers are becoming more conservative in stocking up. At the same time, thanks to the doubling of large-capacity Enterprise SSD orders, the average price of NAND Flash products in the second quarter continues to rise by 15%, and it is estimated that the revenue of NAND Flash in the second quarter has the opportunity to increase by nearly 10% quarter-on-quarter.