The driver is capacity reallocation, not a substitution narrative
The tempting explanation is "domestic substitution is accelerating." That is the result, not the cause. The underlying mechanism is structural reallocation of global memory capacity plus the siphoning effect of AI servers on DRAM and NAND.
Per IDC and TrendForce: the HBM market is heading toward roughly $51bn in 2026 against a supply adequacy of only about 2%; the three majors are shifting over 70% of advanced capacity to HBM and DDR5; and consumer DDR4, LPDDR4 and SLC NAND lines are being systematically compressed.
In other words, the majors are actively withdrawing from low-margin, low-priority markets. GigaDevice — one of few domestic players with volume SLC NAND, NOR Flash and (via its CXMT relationship) DRAM capability — inherits the displaced demand. The equation is supply contraction + inelastic demand + an open substitution window = price elasticity released.
Three tiers, and only two of them are real
| Tier | What is happening | Representative parts |
|---|---|---|
| Genuinely short — SLC NAND | Up ~40–85% over three months, some industrial grades over 120%. Total inventory down more than 60%; sub-$1.5 sources gone. Samsung and Micron have exited 2D SLC NAND, leaving a supply gap above 40%. | GD9F1G04 · GD9F2G04 · GD9F4G04 (1Gb–4Gb SLC) Industrial control, medical, automotive, surveillance — long-life, high-reliability |
| Structurally tight — automotive / industrial NOR | Up ~15–30% (automotive > industrial > consumer); inventory down 30–40%. General parts still available, automotive grades tight. Driven by AIoT, cockpit and optical-module demand as overseas majors trim automotive capacity. | GD25Q127E (automotive 128Mb) · GD5F1GQ5 (1Gb NOR) Automotive, industrial MCU, server BIOS, optical modules |
| Sentiment — general DRAM & MCU | DDR3/LPDDR4 up only ~5–12%, far below the international majors; channel inventory still high. General GD32 MCU up ~3–8% with ample stock and many alternatives — cost pass-through and sentiment, not a supply imbalance. | DDR3 / LPDDR4 · general GD32 MCU |
What a sourcing team should actually do
- Don't switch part numbers on urgent programmes under a "domestic substitution" banner. SLC NAND and NOR are substitutable but need requalification — in automotive and medical the time cost can exceed the price loss you were avoiding.
- Watch for bundled increases. Some distributors quote non-scarce parts (general MCU) alongside genuinely scarce ones to manufacture an impression of across-the-board tightness.
- Lock long-tail legacy inventory early. For end-of-life parts such as 256Mb NOR and 1Gb SLC, build 6–9 months of cover before supply closes.
- Decide on data, not headlines. The useful question is not "GigaDevice went up 25%" but "how many sources still quote my exact part, and how has that price moved in the last two weeks."
Bottom line
This price cycle is a real consequence of AI restructuring global memory capacity — but the market response is uneven. SLC NAND and automotive NOR deserve active monitoring; DDR4 and general MCU are more sentiment than substance and should not be chased. The real supply-chain risk does not live in the headline. It lives in your specific part number's inventory curve, quote count and lead-time movement.
