On Tuesday, Micron Technology (NASDAQ: MU) announced that it will invest an additional $24 billion in Singapore over the next decade to build a new NAND flash wafer fabrication plant, aiming to address the tight supply of storage chips driven by artificial intelligence. Micron’s stock price surged more than 5% in pre-market trading.
This new facility will be Singapore’s first dual-layer wafer plant, with a cleanroom area of 700,000 square feet. Wafer production is expected to begin in the second half of 2028. The project will create approximately 1,600 new jobs.
This move highlights the intensifying supply-demand imbalance in the global storage chip market. With the rapid expansion of AI infrastructure driving a surge in NAND demand, Micron, along with its South Korean competitors SK Hynix and Samsung Electronics, has shifted its production focus to high-end AI chips, leaving PC and smartphone manufacturers facing a shortage of storage chips.
Micron’s Large-Scale Expansion a Key Part of Global Capacity Strategy
Micron’s significant capacity expansion is a key component of its global production strategy. The company recently broke ground on a $100 billion facility in New York to alleviate what it calls “unprecedented supply shortages.”
AI Demand Drives NAND Price Surge
NAND flash, which serves as a replacement for hard disk drives, is in increasing demand due to its faster access speeds in AI infrastructure. These chips are typically sold in solid-state drive (SSD) form and can be directly plugged into a computer’s hard disk interface.
Counterpoint Research Director MS Hwang noted, “The importance of NAND in the AI field has grown significantly, and NAND prices have risen sharply. Suppliers are reducing their focus on traditional consumer markets, such as PC SSDs and mobile flash, while increasing their supply of enterprise-grade SSDs for data center servers.”
The global storage market is dominated by Micron and its two South Korean competitors. Since last year, the three companies have prioritized the production of high-end chips needed for AI infrastructure, diverting resources away from other segments of the storage chip market, leading PC and smartphone manufacturers to warn that storage chip shortages are impacting their businesses.
Global Capacity Expansion to Alleviate Supply Constraints
To ease supply constraints, Micron is significantly expanding its production capacity worldwide. In addition to the Singapore project, the company recently began construction on a $100 billion facility in New York.
Singapore is already one of Micron’s key NAND production bases. In early 2025, Micron announced plans to invest $7 billion in Singapore over the next few years to expand its manufacturing capabilities to meet the demand for advanced storage chips required for AI training. Micron has long relied on Singapore and Japan as critical production hubs.
The new wafer plant will work in tandem with the recently begun HBM advanced packaging facility, further solidifying Singapore’s crucial role in the global storage supply chain. Micron’s investment in Singapore aligns with the country’s strategic goals of advancing industries such as AI and cutting-edge chip manufacturing. The Singaporean government has already committed to investing over S$1 billion (US$786 million) to support local AI research.