AI storage demand triggers expansion wave! Kioxia plans to build its third wafer factory in Iwate Prefecture, Japan.

According to informed sources, Japanese storage chip giant Kioxia is constructing a new wafer manufacturing plant at its production base in Iwate Prefecture, northern Japan, to increase capacity and meet the ongoing strong demand for artificial intelligence (AI)-related storage. One of the sources indicated that Kioxia plans to announce its expansion plans later on Thursday. The Tokyo-based chip manufacturer intends to produce high-end NAND chips for data centers at its Iwate Prefecture facility, while its other major production base in Yokkaichi, Mie Prefecture, will focus on chips for consumer products such as smartphones. The new factory will be the third facility at this production base, primarily producing the companys latest generation of high-density 3D flash memory chips, designed to help handle the massive workloads generated by AI services. Kioxia has already begun delivering samples of its 10th generation BiCS FLASH 3D flash memory chips to major AI data center operators last month. This 1Tb TLC (triple-level cell) flash memory chip, utilizing a 332-layer stacked architecture, is exclusively produced at Kioxia's Fab2 wafer factory in northern Iwate. The BiCS10 flash memory chip being launched by Kioxia represents a significant leap in its technology roadmap. Compared to the 8th generation BiCS FLASH, the 10th generation product has achieved several key breakthroughs: the number of stacked layers has risen from 218 layers to 332 layers, the storage density exceeds 29Gb/mm, representing a 59% increase over BiCS8. The I/O interface supports Toggle DDR6.0 standards, with speeds reaching up to 4800MT/s, which is a 33% improvement over the 8th generation. Power consumption has also been significantly optimized: output power consumption is reduced by 34%, read energy efficiency has improved by 30%, input power consumption has decreased by 10%, and write energy efficiency increased by 18%. From a technical architecture perspective, BiCS10 fully continues the two core underlying technologies introduced since the 8th generation: CMOS direct bonding to arrays (CBA) and pitch switching (OPS). The CBA architecture enhances the stacking layer limit by producing the memory array wafer separately from the logic CMOS wafer and then bonding them, breaking the wiring limitations of traditional monolithic wafers. The continuation of this mature process system means that there is no need to establish a completely new production line process, significantly shortening the ramp-up period for mass production of new products. Kioxia stated in its announcement that this new product line will primarily be integrated into enterprise-grade and data center solid-state drives (SSDs) to address the increasing urgent demand for high performance, large capacity, and low power consumption in the AI storage sector. It is reported that this investment will be implemented in partnership with manufacturing collaborator SanDisk (SNDK.US). Informed sources added that Kioxia and SanDisk will seek subsidies from the Japanese government. In recent years, Japan has been providing financial support to companies expanding chip manufacturing capacity in Japan, including Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR (TSM.US), Sony (SONY.US), and Micron Technology, Inc. (MU.US). Kioxia CEO Nobuo Otani and SanDisk CEO David Goeckeler are scheduled to visit Japanese Prime Minister Sanae Takaichi on Thursday afternoon. Kioxia is facing increasing pressure to ramp up production to meet years of sustained demand through ultra-long-term contracts. This announcement follows the recent expansion plans unveiled by South Korean competitors and the rising market share of China's Yangtze Memory Technologies Co. (YMTC). According to the latest data from market research firm Counterpoint Research, Yangtze Memory Technologies, a Chinese NAND storage giant, is rapidly expanding its share in the global NAND flash memory market and is projected to rise to third place globally by the second quarter of 2026 based on shipment volume, trailing only behind the two global storage chip giants, Samsung Electronics and SK Hynix, both headquartered in South Korea.