NAND flash price decline widens from 30% to 35% this quarter

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Previously, TrendForce said that the supply chain inventory overstock in the third quarter of 2022 has a tendency to spread, at the same time, distributors are slow to destock, and customers generally take a wait-and-see attitude, which makes the balance of supply and demand deteriorate rapidly. The price of NAND flash memory is expected to fall by 8% to 13% in the third quarter of 2023, and the trend will continue into the fourth quarter of 2022.

2023 DRAM Demand

Although the third quarter is still a month away, the problems encountered by NAND flash appear to be more severe than expected. The latest survey report released by TrendForce shows that after entering the second half of 2022, transactions in the NAND flash memory market have been lukewarm, with buyers on the sidelines, preferring not to negotiate to price. At the same time, factory inventory pressure has reached a tipping point, and NAND flash makers continue to lower their prices to seal deals, a move that has led to further declines in NAND flash pricing.

TrendForce expects the price decline of NAND flash memory to expand from 30% to 35% in the third quarter of 2023. If some NAND flash memory manufacturers do not reduce production, the market may continue to adjust. In the long run, the price of NAND flash memory will fluctuate greatly.

In the past two years, the COVID-19 epidemic has promoted digital transformation, and notebook computers and servers have stimulated the rapid growth of NAND flash consumption. In order to meet demand, NAND flash memory manufacturers have been aggressively expanding production capacity, accelerating process advancement, and increasing production of products with 128 layers or more. However, after entering the second half of 2022, the market situation has deteriorated sharply, and smartphone and notebook computer manufacturers have reduced their purchase orders, indicating that the NAND flash memory market has been oversupplied and needs to be adjusted. Looking forward to 2023, due to the conservative attitude of various electronic consumer brands, it is difficult for the market to improve next year.

TrendForce believes that NAND flash memory manufacturers will do whatever it takes to maintain market share in the fourth quarter of 2022, leading to a collapse in NAND flash prices, which may drop by another 20% by then. Under the shadow of rising inventory pressure and tepid market demand, the decline is still likely to expand.

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