SanDisk: AI data centers still lack a cost case to replace HDDs with SSDs

Soaring NAND prices driven by AI workloads have not translated into SSD dominance in data centers, as SanDisk underscores the persistent cost advantage of HDDs for cold/warm storage. This imbalance is triggering architectural ripple effects: AI accelerators are being redesigned to tolerate HDD latency, while storage software aggressively tiers data—hot in DRAM/SSD, bulk in HDD. Regulatory pressures in the U.S. and EU for localized memory production further deter aggressive capacity expansion, prompting Samsung and Kioxia to prioritize supply discipline over market share. Competitively, Western Digital and Seagate are doubling down on HAMR/MAMR to extend HDD relevance, while YMTC targets edge AI with high-density QLC 3D NAND. Over the next 18 months, SSDs won’t displace HDDs at scale unless NAND cost per GB drops another 60%—a near-impossible feat under current geopolitical constraints.