Morgan Stanley Securities warned that weaker demand will lead to a more rapid decline in memory prices in the second half of the year, affecting all three major memories.
The three major memories are dynamic random access memory (DRAM), coded flash memory (NOR Flash), and storage flash memory (NAND Flash).
The report points out that due to weak demand, coupled with the high inventory levels of manufacturers and clients, the memory supply chain will face tremendous de-stocking pressure, causing prices to fall further in the second half of the year, and the severity will be greater than market expectations.
For the Chinese Taiwanese manufacturers, DAM believes that in addition to Macronix, Huabang Electric, Nan Ya Tech and Powerchip, which are inferior to the broader market, even the original relatively bullish Qunlian, the evaluation turned to neutral. Although the growth momentum of the group in mainland China is strong, but due to high inventory and NAND price environment deterioration, the NAND boom cycle is unlikely to recover quickly in the short term.
According to the report, the industry believes that SK and Samsung have ceased production of 1Gb and 2Gb memory and reduced production of DDR3. However, as the market outlook for CMOS image sensors tends to be weak, Samsung is using CIS capacity to produce DDR3, making the supply situation for specialty DRAM even less favorable. In the long run, SK and Samsung will not abandon the consumer DRAM market, but rather move to DDR4 with an eye on 4Gb products.
