The price decline of NAND flash memory in 2022Q3 expanded
Due to the contamination of production materials by Western Digital and Kioxia, the price of NAND flash memory in the second quarter of 2022 turned from falling to rising. However, the sales volume of consumer electronics products in the second quarter of 2022 was lower than expected, coupled with the progress of NAND flash memory technology and the increase in production capacity, the NAND flash memory market began to experience an oversupply situation.
According to the latest survey report released by TrendForce, in the third quarter of 2022, the inventory backlog in the supply chain 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. It is expected that the price decline of NAND flash memory will expand from 8% to 13%, and the trend will continue to the fourth quarter of 2022.
In terms of client SSDs, due to weak demand, major PC manufacturers have significantly reduced purchases to absorb inventory in the first half of 2022. The focus of suppliers is beginning to shift to SSDs with 176-layer NAND flash memory. In addition, YMTC began to ship SSDs used in notebook computers in the second half of the year, which has made price competition among suppliers increasingly fierce. It is necessary to give greater discounts to encourage customers to increase their order volume. The decline in client SSD prices is expected to widen in the third quarter of 2022, falling between 8% and 13%.
In terms of enterprise-level SSDs, affected by the overall economic recession, enterprise orders continued to decline, and prices are expected to drop by 5% to 10% in the third quarter of 2022. On the eMMC side, weak demand from major applications such as Chromebooks and TVs has caused buyers to control inventory very carefully, and the situation is difficult to change in a short period of time. Prices are expected to fall by 8% to 13% in the third quarter of 2022. In terms of UFS, the recent promotions by merchants have not effectively driven the growth of smartphone sales, and destocking has become a top priority for major brands. Prices are expected to drop by 8% to 13% in the third quarter of 2022.
