Industry insiders have said that Samsung is planning a major price hike as early as next month following ongoing production cuts. It has been a rough year for the NAND and DRAM industry with reports going as far back as January that a boom-and-bust cycle was still in effect and that manufacturers were still scrambling to adjust to lower sales. Samsung had begun its own strategies to reduce its losses by cutting wafer production since the beginning of the year.
Per Fortune:
“Already, Samsung Electronics Co. and its rivals are losing money on every chip they produce. Their collective operating losses are projected to hit a record $5 billion this year. Inventories — a critical indicator of demand for memory chips — have more than tripled to record levels, reaching three to four months’ worth of supply.”
It is now suspected that demands from the enterprise sector are growing as it expands to accommodate the needs of AI technology which is now reportedly fueling new DRAM sales expectations for Samsung. Unfortunately though the same cannot be said for its NAND division.
Per Business Korea:
“According to semiconductor industry sources on Oct. 4, Samsung Electronics is planning to implement a price increase of over 10 percent for NAND products during the fourth quarter of this year. It is anticipated that the increased prices will be applied to new contracts as early as this month.”
Samsung had reportedly begun reducing wafer production in January and then continued this path in Aril. According to industry insiders, it had cut production for DRAM by thirty percent, and then up to forty percent is expected for NAND memory by 2H23. It has been said that sales in the DRAM sector are on the rise, due to orders by server companies and mobile device manufacturers, while NAND sales have not improved. The lack of NAND-based product sales has led to the belief that Samsung is planning up to a ten percent price hike beginning next month along with further reduced production.