The chip giant plans to raise the price of such chips by 20% !

According to South Korean media reports, Samsung plans to this month to next month with the main mobile, PC, server-side customers on NAND flash price renegotiation, target price increase of 15 to 20% . After more than a year of oversupply, the price of Samsung Electronics' NAND flash memory briefly approached cost.

Therefore, the company decided to enter into negotiations with major customers, with a view to price adjustment to a more reasonable level.

The report noted that price negotiations for the first quarter were inconclusive, but that customers were anxious to ensure adequate supply in response to the steady increase in prices in the NAND flash market. Due to oversupply, 2023 such as Samsung have to sell their products below cost until capacity utilisation falls below 50% in the second half of the year and the balance is restored in the fourth quarter.

The global NAND Flash industry 2023 $11.49 billion in revenue in the fourth quarter, up 24.5% , according to TrendForce, a research firm. The growth was helped by a jump in year-on-year shipments of memory chips as end-of-year demand picked up thanks to year-end promotions and Aftermarket orders. Samsung remained the leader, with 2023 Q4NAND's revenue of $4.2 billion, up 44.8 percent year-on-year and the largest increase of any manufacturer. The average unit price of Samsung's NAND products rose 12 per cent month-on-month.

Samsung is not alone in announcing the NAND price increase.

Recently, Guo Jiazhang, general manager of huirong, one of the world's top two memory-based flash memory control chip factories, said that the price of NAND chips continues to rise“Without a doubt”. The industry has generally agreed to increase by another 20% in the second quarter. With the North n data center in March began to pull goods, demand after the lunar new year has not decreased, AI applications and other three major momentum, this wave of short-term rise“Will not turn back”, will rise all the way to the first half of next year.

Gou Jiazhang analysis, the previous major NAND chip suppliers are in serious losses, in the price did not rise to the point of satisfaction before the industry will not easily increase production. Even before the NAND chip price in the international factory production cut effect, has risen a wave, but has not yet increased enough, the second quarter of a 20% price increase has been the consensus of the industry.

Gou Jiazhang pointed out that not only has the effect of production cuts by large factories continued to ferment, but the NAND industry is now facing three momentum factors to help increase prices, including the North n data center began to load goods in March, and demand has not decreased after the year, aI applications (including AI servers, AI pcs and AI phones) are on the rise. This year will be a“Good year” for the memory industry, and the second half will be even stronger.

Gou Jiazhang said bluntly that the original factory not only wanted to raise the price to make the gross margin positive, but also wanted to raise the gross margin to more than 30% through constant price increases. That would be a healthy and reasonable level, the analysis quote will rise all the way to the first half of next year.

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