Samsung plans to significantly increase NAND flash memory prices

In the first fiscal quarter of 2023, Samsung encountered its most dismal performance since the financial crisis of 2008. The semiconductor division bore significant losses, with the deteriorating performance of the memory department chiefly responsible for the diminished quarterly revenue. As a result, Samsung retracted its steadfast stance of “no production cuts,” slashing production of DRAM chips and NAND flash memory from the second quarter onward. This strategic move was aimed at addressing the slackening demand and stabilizing prices, with reductions in the latter half of the year reaching a stark 30% and 40% respectively, compared to the year’s outset.

With the robust rise of artificial intelligence (AI), enterprises have witnessed a surge in server DRAM demand. Coupled with dwindling customer inventories, the DRAM market has started to show signs of rejuvenation. Now, Samsung has shifted its focus to NAND flash memory. According to Business Korea, Samsung is poised to hike the prices of its NAND products by over 10% in the fourth quarter, with the anticipated implementation commencing as swiftly as this month’s new contracts. This adjustment is bound to cast a palpable impact on consumers eyeing SSD purchases.

As the vanguard of the global memory semiconductor industry, Samsung’s maneuvers exert a profound influence on market trajectories. Specifically, within the realm of NAND flash memory, Samsung commands the lion’s share of the market. Should this pricing augmentation prove viable, competitors like SK Hynix and Micron might hastily echo Samsung’s lead.

Contrastingly, the NAND flash memory market has remained in a state of inertia, undeterred by concerted production cutback efforts from industry leaders like Samsung. Perhaps Samsung, in a bid to swiftly alter this stagnant tableau, envisages a dual strategy of price elevation complemented by supply contraction.