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NAND flash price will continue to fall until the end of the year due to overproduction. SSD should get cheaper
TrendForce Analysts Share Third Quarter NAND Flash Market State and Market Forecast for Last Quarter 2021. The general conclusion is disappointing for manufacturers – more memory is produced than it needs. For you and me, this means that prices for NAND products are going down and will continue to go down in the near future.
Analysts’ Key Finding – NAND Prices Were Falling In Q3 Due To Oversupply And Low Demand In Data Centers. Nevertheless, the market revenue for the quarter remained stable and even grew by 0.3% to $ 14.5 billion. The market owes this stability to the increase in NAND output in terms of capacity, while the average selling price has decreased. Thus, the growth in the production of NAND chips in terms of bits increased by 9%, and the average selling price for memory decreased by the same 9%.
In part, sales of flash memory in the third quarter were saved by four factors, although they could not turn the tide. First, the demand for smartphones began to form by Christmas. Secondly, Huawei was using the last bit of strength to accumulate stocks of flash memory, before new US sanctions in mid-September put a new barrier on this path. Third, Chinese smartphone makers have rushed to fill the niche that Huawei’s departure has begun to shape. Fourth, I needed a supply of flash memory for the production of Apple iPhone 12 smartphones.
A negative factor to all of the above was the fact that in the wake of the quarantine panic, server manufacturers in the second quarter accumulated so much stocks that they will not need SSDs for a long time.
As follows from the presented table, Samsung remains a confident leader in the flash memory market, and even increased its share in it over the year. Last but not least, Samsung’s revenue growth is associated with significant volumes of memory shipments for the Apple iPhone 12 assembly. Another distinguished company can be recognized as the Japanese Kioxia. The growing demand for memory of this offshoot of Toshiba is associated with the purchase of the SSD business of the Taiwanese company Lite-On and with the sale of flash products through this new brand.
WDC, SK Hynix and Micron slightly reduced revenues in the third quarter, but Intel’s revenue fell the most – by 30.5%. The giant of the microprocessor market was led by the love for the production of expensive corporate-purpose SSDs, and for them during the specified period, the demand for them dropped dramatically. However, over the next five years, Intel will worry less and less. She has already agreed to sell this business to SK Hynix. The loss head will hurt others.
As for Q4, TrendForce expects overproduction will not go away, and excess NAND flash chips will not dissipate. In addition, Samsung and China’s YMTC intend to increase production volumes, which will entail a new oversupply. Thus, in the fourth quarter, prices for flash memory will continue to decline with all the ensuing consequences.