Phison has begun enforcing prepayment terms for some customers as NAND flash prices have exploded by nearly 500% in the past half-year. The shift reflects broader market pressures on the storage supply chain, where faster settlements or upfront payments are now standard to secure capacity.
The company’s latest E28 controller, produced at TSMC’s 6 nm node, remains a key product in its lineup. However, the unprecedented price volatility has forced Phison to adjust financial arrangements with clients, particularly those relying on high-volume NAND orders. While the E28’s manufacturing process is stable—leveraging mature semiconductor nodes—the surge in demand for AI infrastructure has strained supplier liquidity, prompting Phison to act as a buffer between NAND producers and SSD makers.
For small businesses or startups, this change introduces operational challenges. Prepayment requirements mean capital must be committed well before inventory arrives, potentially squeezing margins. Yet, the alternative—delayed settlements—risks higher costs if NAND prices climb further. Phison’s move underscores how AI-driven demand is reshaping traditional supply chains, with ripple effects felt across the industry.
The practical impact for buyers is immediate: securing storage products now requires financial flexibility that wasn’t always necessary in prior market cycles. Whether this becomes a permanent shift or a temporary adjustment remains to be seen, but one thing is clear—NAND’s new price reality demands different strategies from both suppliers and customers alike.
