Again in August, TrendForce Analysis predicted that attributable to an oversupply in NAND flash reminiscence, the worth of SSDs may drop by 5% to 10% within the third quarter.
Since then, the economic system has solely worsened and the oversupply has continued, and whereas TrendForce hasn’t reported the Q3 actuals, it is now predicting 15% to twenty% drop in NAND flash costs within the fourth quarter on high of the Q3 drop..
TrendForce says consumers of NAND flash reminiscence—distributors that make SSDs however don’t manufacture their very own reminiscence—have decreased their NAND stock and in the reduction of on new purchases within the second half of the 12 months. In the meantime makers of reminiscence drastically decreased costs to spice up gross sales. Now TrendForce predicts that earlier than the tip of the 12 months, suppliers shall be promoting reminiscence at a loss and cut back manufacturing.
No sooner had TrendForce issued the report than reminiscence makers reported a decline in gross sales. Micron introduced its Fiscal This fall revenues have been 19.7% beneath the identical quarter final 12 months and mentioned it could cut back constructing out manufacturing capability till demand comes again. Just a few days later, Kioxia, the Japanese reminiscence manufacturing agency spun out from Toshiba, introduced a 30% reduce in wafer manufacturing, additionally citing market situations.
TrendForce reported that it expects server shipments to fall within the fourth quarter of this 12 months, driving down demand for SSDs. A precipitous drop in PC gross sales this 12 months additional cuts into that demand, accelerating worth competitors and supporting the TrendForce prediction of a 15% to twenty% SSD worth drop in This fall.
Attributable to data-center buildout over the previous two years to deal with the surge in folks working remotely attributable to COVID, demand for SSDs outstripped provide, which result in shortages, mentioned Jim Useful, president of Goal Evaluation. “No one noticed that coming,” he mentioned. “It seems that this build-out is easing, and that the overheated market is able to return to extra typical demand patterns.”
He doesn’t anticipate consumers to buy extra SSDs than they’ve demand for simply to benefit from the low costs; higher know-how may come alongside earlier than they’ve the possibility to make use of the overstock. “You don’t purchase greater than you at the moment want when there’s a giant sale, as a result of it gained’t keep fascinating for all that lengthy,” Useful mentioned.
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