Samsung to Cut Production of 3D NAND and DRAM
Samsung was the one main reminiscence producer that did not reduce output of DRAM and 3D NAND final 12 months when demand for these commodity ICs fell on account of softening in PC and smartphone gross sales. Nonetheless, as the corporate’s revenue fell within the first quarter of 2023, it determined to scale back its reminiscence manufacturing to steadiness the provision and demand state of affairs out there.
“Now we have reduce short-term manufacturing plans, however as we anticipate strong demand for the medium to long-term, we’ll proceed to spend money on infrastructure to safe important cleanrooms and develop R&D funding to consolidate know-how management.” revealed by Samsung Bloomberg reader.
Samsung is the world’s largest provider of DRAM and NAND, and its reminiscence gross sales contribute considerably to the corporate’s earnings. The corporate ordered a 45.1% share of the DRAM market and 33.8% Income share of NAND market in This autumn 2022 in line with TrendForce.
Whereas the corporate has formally said that it’s going to scale back reminiscence manufacturing, it has by no means disclosed how considerably it plans to scale back wafer initializations and reminiscence bits output.
Most of Samsung’s opponents decreased reminiscence manufacturing on older applied sciences, however continued to regularly improve reminiscence manufacturing in new fabrication processes. Sometimes, the latest nodes scale back chip prices and improve bit-output per wafer, so in lots of circumstances, the reminiscence improve in new nodes is greater than offset by bit-output associated manufacturing interruptions in older nodes.
Nonetheless, analysts consider that Samsung’s intention to chop reminiscence manufacturing will have an effect on the steadiness of provide and demand out there and a minimum of sluggish the decline in reminiscence costs in Q2 2023.
“Counterpoint expects utilization charge to be lowered [will] “It might sluggish the decline of commodity reminiscence costs,” mentioned Brady Wang, a senior analyst. Nikkei Asia. “Nonetheless, this surplus is because of weakening demand and excessive stock, so Samsung’s manufacturing reduce will not be anticipated to stimulate gross sales. Subsequently, Counterpoint believes that the state of affairs of extra provide will proceed till the third quarter, when the market begins to deplete stock for the fourth quarter and seasonal demand.”
Samsung’s Q1 2023 income fell to 63 trillion received ($48,877 billion), or 19% from the identical quarter of the earlier 12 months. The corporate’s income fell to 600 billion received ($450 million), or 95% year-over-year, beneath the typical of 1.4 trillion received ($1.064 billion) analysts had estimated.
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