Nanya DRAM ASPs Jump Over 60% as NAND Makers Pivot to AI-Specific Products

Nanya Technology reported strong third-quarter 2026 earnings driven by surging DRAM prices and robust AI demand. Consolidated revenue reached NT$133.65 billion, up 61.9% quarter on quarter, with DRAM average selling prices rising more than 60% while shipment volume declined by a mid-single-digit percentage. Gross profit reached NT$114.48 billion, with gross margin up 6.2 percentage points sequentially to 85.7%, and operating profit of NT$106.89 billion left operating margin 6.3 percentage points higher at 80%. AI infrastructure applications, including servers, networking, storage and system management, accounted for more than 20% of revenue.

Management said the step change in pricing was largely mechanical. President Pei-Ing Lee explained that the more than 60% sequential ASP increase was driven by the expiry of older long-term agreements in June; those contracts were negotiated in mid-to-late 2025 when prices were lower and were fulfilled by the end of June, allowing higher market prices to take effect under new agreements in July. Lee expects DRAM ASPs to continue rising in the fourth quarter, although the gains will vary by product, leaving room for further gross margin improvement.

AI-driven demand is reshaping both supply and procurement. Lee said growing demand from GPUs, TPUs, CPUs and ASICs is tightening DRAM supply for smartphones, PCs and other consumer applications, and with supplier inventories remaining low, memory makers are increasingly relying on long-term agreements to plan capacity and product allocation. Long-term agreements currently cover approximately 50% to 70% of Nanya's business with durations from three months to three years, many customers are seeking to extend three-month contracts to three years or longer, and some have expressed interest in taking equity stakes in Nanya to secure capacity.

On the supply side, equipment installation at Nanya's new Fab 5A is scheduled to begin in the first quarter of 2027, with monthly wafer capacity expected to reach 30,000 wafers by the end of 2028 and 50,000 wafers by the end of 2030, and capital expenditure is expected to rise in 2027 against NT$270 billion of net cash. Its third-generation 10nm-class (1c) node is expected to enter customer validation in the first quarter of 2027, with fourth- and fifth-generation nodes and extreme ultraviolet lithography progressing as planned, while projects with US customers in AI ASIC memory have begun small-volume shipments.

In NAND, Samsung Electronics and SK hynix are expected to see a sharp increase in flash profits in 2026 as surging demand for enterprise solid-state drives drives up memory prices. Samsung is in the early stages of developing three zNAND products: zNAND-O for on-device AI using through-silicon vias to stack four or eight NAND dies, zNAND-T targeting throughput and bandwidth for high-capacity AI data centres, and zNAND-I designed to maximise input/output operations per second for inference workloads such as key-value caches. Samsung aims for 10 times the bit density of DRAM and seven times the read bandwidth and power efficiency of conventional NAND with zNAND-O, with samples planned for 2028, while SK hynix established its AI-NAND family in the second half of 2025 spanning AIN P for performance of up to 100 million IOPS, AIN D for petabyte-level density and AIN B for bandwidth.