SK Hynix explores deeper cooperation with Kioxia on NAND flash as AI demand reshapes memory market

SK Hynix, the world’s second-largest NAND flash memory producer, is actively exploring deeper collaboration with Japan’s Kioxia Holdings, the third-largest player in the space. CEO Kwak Noh-Jung confirmed on August 27 that while the company has no fixed plans for its existing stake in Kioxia, co-development opportunities in NAND flash are very much on the table.

The timing is hard to ignore. The same day Kwak made his comments, Kioxia and its longtime partner SanDisk announced plans for over $31 billion in NAND production investments in Japan through 2032. Those plans are contingent on government support.

The ownership angle that makes this interesting

SK Hynix isn’t just a casual observer of Kioxia’s business. The South Korean chipmaker holds an indirect stake of approximately 14.19% in Kioxia through a Bain Capital special-purpose vehicle. That makes SK Hynix Kioxia’s single largest shareholder, edging out Toshiba, which reduced its holding to 14.12%.

The investment traces back to 2018, when Bain Capital led the acquisition of what was then Toshiba Memory. SK Hynix’s contribution totaled roughly 395 billion yen, or about $2.48 billion at the time.

Samsung controls roughly 31-32% of global NAND flash sales. SK Hynix, including its Solidigm subsidiary, commands about 17-20%. Kioxia sits at around 14-15%. Together, SK Hynix and Kioxia would represent north of 30% of the market, putting them in direct competitive range of Samsung.

Why NAND flash matters more now than it did two years ago

Kioxia already maintains a longstanding joint venture with SanDisk, making their relationship one of the most durable partnerships in the chip industry. Adding a layer of cooperation with SK Hynix would create an unusual arrangement: two of the three largest NAND producers working together while Kioxia simultaneously maintains its SanDisk alliance.

It’s worth noting that not every collaboration attempt between SK Hynix and Kioxia has panned out. Previous discussions about producing HBM chips at Kioxia’s fabrication facilities were called off in 2025. The current conversations appear more narrowly focused on NAND co-development, which aligns more naturally with what both companies already do.

The competitive and geopolitical backdrop

Kwak’s comments came shortly after a ceremony for SK Hynix’s new plant in West Lafayette, Indiana. SK Hynix is headquartered in South Korea. Kioxia operates out of Japan. And both are expanding their footprints in the US.

The NAND flash market has only five major producers globally: Samsung, SK Hynix, Kioxia, Western Digital (through SanDisk), and Micron. Any partnership between two of them alters the balance of power, and regulators in multiple jurisdictions may have opinions about two of the top three players getting closer.

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