[News] Taiwan’s Phison Reportedly Follows Key Suppliers Kioxia, Sandisk with New Prepayment Policy

Following the lead of major NAND players like Kioxia and Sandisk, Taiwanese NAND Flash controller maker Phison Technology informed customers in late February of updated payment terms, requiring either prepayment or shorter payment cycles, according to Commercial Times and ijiwei.

The company, according to the client notice issued on February 23 cited by the reports, explained that the surge in NAND demand driven by AI infrastructure has prompted key suppliers to tighten their payment policies. To stay aligned, Phison is now requesting prepayment or accelerated payment for upcoming orders. The move, according to Phison, will allow it to secure materials more efficiently and strengthen its operational flexibility.

As highlighted by Commercial Times, the payment policies vary among vendors, but major NAND manufacturers including Kioxia have already moved to require prepayment before shipment.

Ijiwei, on the other hand, suggests that since the second half of 2025, NAND contract prices have surged, doubling through multiple rounds. U.S. supplier SanDisk even went as far as requiring downstream customers to prepay in full to lock in supply for the next one to three years, the report adds.

Sandisk Leads the Shift to Multi-Year Contracts

Notably, Investing.com reports that at an investor’s forum last week, Sandisk CEO David Goeckeler also confirmed the company is shifting toward multi-year contracts designed to balance steady demand with favorable economics, moving away from the industry’s conventional quarterly pricing model.

These shifts signal a deeper market transformation, as hyperscalers increasingly demand clearer visibility into supply to support their growing infrastructure. Goeckeler, cited by the report, noted that customers are now submitting demand forecasts stretching as far as 2028, sparking talks about multi-year contracts spanning one to five years.

According to Investing.com, the trend also mirrors Sandisk’s outlook, which anticipates data centers becoming the largest NAND market segment in 2026, with growth projections leaping from the mid-20% range to around 60% over two consecutive cycles.

Kioxia Secures AI Memory Orders Through 2028

Meanwhile, Japanese NAND giant Kioxia is riding a massive surge, with Q1 2026 profits projected to jump roughly 26-fold year-over-year to ¥340 billion, underpinned by strong long-term contract visibility, according to Alphabiz.

The report highlights comments from Executive Vice President Hideki Hanazawa, who said product prices are climbing at an exceptionally fast pace and that long-term AI server orders extending through 2027–2028 are already secured. In response, Kioxia plans to invest around ¥280 billion—24% higher than last fiscal year—to expand advanced AI memory production at its Mie and Iwate factories, the report adds.

Surprisingly, even as a major NAND supplier, Kioxia is facing headwinds from the DRAM price surge. According to Nikkei, the company relies on externally sourced DRAM for SSD temporary storage, and rising costs have “a tangible impact on procurement expenses,” said Executive Vice President Hideki Hanazawa. Kioxia plans to ease the pressure by diversifying suppliers and passing costs on to customers, Nikkei reports.

Read more

• [News] SanDisk Beats Forecasts with 600%+ Profit Jump; First LTA Reportedly Sealed as Momentum Builds
• [News] Kioxia Posts Record ¥543.6B Q3 FY25 Revenue, Confirms 2026 NAND Fully Booked

(Photo credit: Phison)