As 2026 commences, the global memory market appears to be entering a new “super cycle,” shaped by the convergence of multiple structural forces. On the surface, the market’s strong recovery is widely attributed to aggressive procurement of high-bandwidth memory (HBM) by hyperscale data center operators, tightening supply and prices rising for both DRAM and NAND. Beneath this apparent demand surge, however, a more fundamental force is reshaping the market: a rapidly propagating “crowding-out effect” spreading throughout the semiconductor supply chain.

In a recent interview, Martin Lin, head of marketing at Macronix, described this phenomenon as an AI-driven “butterfly effect.” Surging demand for AI processors has absorbed a substantial share of industry capacity, spanning wafer fabrication, packaging and testing, substrates, probe cards, and critical materials. Across the supply chain, capacity allocation has increasingly prioritized AI-related products, compressing production and testing schedules for non-AI memory devices. In some cases, normalization has been pushed to the end of the year or beyond, triggering a chain reaction of widespread shortages and sharply extended lead times. Lin emphasized that this situation does not represent a short-term imbalance caused by any single product category, but rather a systemic crowding-out effect resulting from large-scale resource reallocation across the entire semiconductor ecosystem.

This wave of disruption has not only reshaped the DRAM and NAND markets; it has also brought eMMC—long viewed over the past several years as a technology in gradual decline—back to the center of industry attention. Against this major market inflection point, Macronix is leveraging its full portfolio of NOR, SLC NAND, 3D NAND, and eMMC solutions, offering capacity coverage from Mb and Gb to GB. This comprehensive flash portfolio enables customers to identify and deploy appropriate memory solutions in a single step, even under highly volatile market conditions, positioning Macronix as a stabilizing force amid AI-driven supply chain restructuring.

AI Memory Trends: Data Centers vs. Edge

According to Lin, AI-driven memory demand is now advancing along two clearly diverging trajectories. The first is fueled by the escalating computing race in data centers, where both model training and inference require extremely high bandwidth and massive storage capacity. This dynamic has driven a sharp rise in demand for HBM and high-capacity SSDs. In response, leading global memory suppliers have, over the past several years, significantly expanded investments in capacity and R&D for HBM and advanced 3D NAND technologies to support continued growth in model size and complexity.

The second trajectory is emerging as AI infrastructure matures and extends toward edge devices, enabling applications such as smart homes, industrial automation systems, in-vehicle electronics, and distributed Internet of Things (IoT) nodes. Unlike data center environments, these edge platforms do not prioritize peak performance. Instead, they emphasize low power consumption, high reliability, optimized cost structures, and long-term availability of mainstream, standardized memory specifications.

Lin noted that edge AI chips evolve rapidly. If memory suppliers attempt to support each SoC through highly customized solutions, they risk becoming trapped in a cycle of constant specification chasing and inefficient resource allocation. As a result, he believes the market will inevitably gravitate back toward mature, general-purpose, and widely adopted memory standards—an essential foundation for supply stability, cost efficiency and streamlined system-level integration.

Flash Reinvented for Edge AI

As edge AI deployments continue to scale, flash memory is being assigned a more strategic role within system architectures. Lin explained that while memory devices cannot perform complex computations like logic processors, they play a decisive role in data storage efficiency, search capability, and retrieval latency. To address growing edge-side requirements for faster data addressing, Macronix has developed an “in-memory search” technology based on its proprietary memory array architecture. This approach enables search operations to be executed directly within the memory array itself, reducing data movement to DRAM or the SoC and allowing low-power systems to achieve higher overall processing efficiency.

From a security perspective, devices deployed in automotive IoT, surveillance, and industrial control environments face increasingly stringent requirements for secure boot, firmware protection, and secure over-the-air (OTA) updates. To meet these demands, Macronix has evolved its well-established ArmorFlash secure memory family, transforming flash from a passive code storage component into an integral element of the system security architecture and strengthening overall device reliability.

At the same time, as semiconductor process technologies advance into the 5nm, 3nm and even 2nm nodes, system power budgets are being compressed further, making low-voltage memory operation all the more plausible. Macronix continues to advance its 1.2V low-voltage flash portfolio, enabling next-generation systems to reduce power consumption without sacrificing performance.

In automotive electronics and industrial control markets, reliability and long-term supply continuity remain paramount. Automotive NOR flash must deliver fast boot performance alongside high-bandwidth data exchange, while industrial equipment typically requires supply commitments extending beyond ten years. Building on its long-established NOR, SLC NAND and eMMC product lines, Macronix is also developing next-generation 3D NOR flash by leveraging its experience in 3D NAND process technology. The company is targeting a 4Gb capacity per single die, further expanding its presence in high-reliability embedded applications.

Lin added that Macronix’s 3D NOR flash is currently in active development, with a strong focus on ensuring that its performance and reliability match those of existing 2D NOR products. This foundation will allow 3D NOR to play a critical role in the next wave of growth in high-capacity embedded storage.

eMMC Resurgence Amid Supply Gaps

Within the embedded storage market, eMMC has staged an unexpected countercyclical comeback. Over the past several years, as the smartphone industry migrated almost entirely toward higher-speed UFS, eMMC was widely perceived as a memory standard on a path toward obsolescence. However, in applications such as industrial automation, automotive electronics, smart connectivity, and networking equipment—where long product lifecycles and system stability are critical—eMMC has re-emerged as the most practical mainstream solution. Its high integration level, stable specifications, mature supply chain, and guaranteed supply continuity of up to ten years align closely with embedded system requirements.

Macronix has moved quickly to identify and capitalize on the market opportunity created by what it describes as an eMMC “supply gap.” As major NAND manufacturers such as Samsung and Micron have exited the low- to mid-density eMMC segment for embedded applications—redirecting capacity toward higher-density 3D NAND products—the number of suppliers globally with in-house wafer manufacturing capability for these densities has declined sharply. Today, only a limited number of vendors retain control over process technology, wafer production, and packaging and testing schedules.

This capacity gap has rapidly translated into market pressure. Low- and mid-density eMMC products, including 8GB, 16GB, and 32GB, are experiencing pronounced shortages. Spot prices have doubled within a short period, yet demand continues to exceed available supply. Lin noted that capacities below 32GB represent the core volume segment for embedded applications. Long viewed as stable but low-growth, these products have now become strategic resources as a result of supply discontinuities. Many system customers have responded by building inventory earlier and extending procurement cycles, further intensifying supply constraints.

Over the years, Macronix has maintained a sustained commitment to the low- and mid-density eMMC market. Beyond its existing 2D 19nm-based 4GB and 8GB products already in volume production, the company has introduced 48-layer and 96-layer 3D NAND technologies to deliver a more comprehensive and mature product lineup. These solutions improve performance while maintaining cost competitiveness, covering mainstream embedded capacities of 8GB, 16GB, and 32GB, while preserving the attributes customers value most: reliability, quality consistency and long-term supply assurance. These principles have long defined Macronix’s broader flash memory strategy.

More importantly, amid the expanding supply gap, eMMC has secured an early strategic foothold and is emerging as the next long-term growth driver following NOR and SLC NAND. By continuing its commitment to stable supply, the eMMC product line positions Macronix as a trustworthy partner, allowing the company to achieve another strategic portfolio transformation amid rapid industry restructurings.

As flash technologies evolve and market structures continue to shift, one of Macronix’s core competitive strengths is becoming a rare industry asset: the ability to deliver a one-stop, full-range flash portfolio spanning Mb, Gb, and GB densities. In addition to in-house R&D and high-volume production across NOR, SLC NAND, 3D NAND, and eMMC, the company supports multiple density tiers—from megabit-level boot code storage to gigabit-class firmware for edge AI and gigabyte-class eMMC, while maintaining consistent quality and long-term supply reliability.

Macronix offers a comprehensive flash memory portfolio from Mb to GB, enabling a true one-stop solution for embedded customers. (Source: Macronix)

2026 Outlook: Tightening Supply and Resource Race

Looking ahead, 2026 is expected to mark an acceleration in both structural realignment and the upward phase of the memory cycle. Lin observed that DDR memory is undergoing a generational transition, with expectations around DDR4 phase-out already prompting some customers to build inventory in advance. SLC NAND is also tightening as wafer supply declines and materials, packaging and testing capacity increasingly shift toward AI-related products. Meanwhile, demand for NOR flash in AI servers is rising sharply, with the number of NOR devices per server rack increasing to more than thirty units, up from roughly three to five previously. This surge is intensifying competition for shared production capacity between embedded applications and AI servers. In the low- and mid-density eMMC segment, shortages are likewise becoming more structural and prolonged as suppliers exit and resource competition intensifies.

Lin expects these factors to converge into a stronger upward cycle in 2026. Over the next three to five years, he envisions that uncertainty will persist but remains cautiously optimistic about overall market direction. AI-related products will continue to receive priority in capacity allocation, while ongoing supply chain regionalization will further reshape manufacturing footprints. These dynamics also suggest that automotive semiconductors may face an increase of crowding-out pressure in the next round of resource competition.

Amid this structural inflection point, Macronix is reinforcing its market position by deepening its focus on flash and eMMC, leveraging a comprehensive portfolio, high-quality standards, strong reliability, mainstream capacity coverage, and long product lifecycles. With these core strengths, the company is moving steadily through industry transformation while laying groundwork for sustainable growth in the next phase of the memory market.

By: DocMemory
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