SanDisk and Kioxia just committed to pouring more than $31 billion into Japanese NAND flash memory production over the next six years. That’s roughly 60% of what the two companies have spent in Japan across their entire 25-year partnership, compressed into less than a quarter of that time.
The investment, announced on August 27, amounts to approximately 5 trillion yen and will fund infrastructure upgrades and technology improvements at two existing facilities: Yokkaichi in Mie Prefecture and Kitakami in Iwate Prefecture. The centerpiece is a brand-new fabrication plant, Fab3, at the Kitakami site.
The Fab3 gambit
Fab3 alone carries an estimated price tag of 1.8 trillion yen, or roughly $11.3 billion. That single facility accounts for more than a third of the total investment package. Operations are expected to begin in fiscal year 2029 or later.
For context, the Kioxia-SanDisk joint venture has invested over $50 billion (approximately 9 trillion yen) in Japan across the past quarter century. Adding $31 billion more by 2032 represents a dramatic acceleration in capital deployment.
The investment is explicitly tied to surging demand for high-density flash memory driven by AI workloads.
Government backing as a precondition
There’s a catch, though. The $31 billion plan is conditional on support from the Japanese government. On the same day as the announcement, CEOs from both Kioxia and SanDisk met with Japanese Prime Minister Sanae Takaichi to discuss potential government financing. The companies are reportedly seeking public backing for roughly one-third of the overall investment.
What the partnership produces
Kioxia and SanDisk aren’t newcomers to the memory game. Their joint venture, which was extended through December 2034 back in January 2026, has been one of the most durable partnerships in the semiconductor industry. Together they manufacture BiCS Flash, Kioxia’s 3D NAND technology. The current generation, the 10th iteration, was co-developed by both companies.
3D NAND works by stacking memory cells vertically rather than spreading them across a flat surface. Each generation adds more layers, increasing storage density without needing proportionally more physical space.
Kioxia and Western Digital (SanDisk’s parent company until its recent separation) have historically been the second-largest NAND producers globally behind Samsung.