Despite several issues, the memory chip market has observed the steepest decline in demand and the highest inventory levels in history.
The prices are likely to drop until 2Q23 and see some growth change in 2H23. According to memory makers, Samsung Electronics is expected to turn in losses in 4Q22, only two quarters after recording peak earnings in 2Q22.
Memory shipments have remained stagnant in 4Q22. Inventory weeks on hand at the year-end should reach 10-12 weeks. With inventory levels remaining high at least through 1Q23, memory chip prices are likely to continue falling until 2Q23.
The South Korean tech giant, Samsung is looking to expand its capex spend, while other memory makers announced supply reduction plans. On the other hand, Micron Technology’s recent announcement to reduce its output by 20%, up from the original 5%. Samsung Electronics should enjoy market share gains in 2024-2025.