According to Reuters, Samsung Electronics said today that the worst period for the global memory chip market has passed, but it still plans to extend production cuts because the recovery in market demand is largely limited by the field of artificial intelligence. High-end chips used.
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The move highlights an unprecedented downturn in the semiconductor sector, which also led to Samsung’s chip business unit generating a record 8.9 trillion won operating loss in the first six months of this year.
“Industry-wide production cuts are likely to continue in the second half of the year, and demand is expected to gradually recover as customers continue to reduce (chip) inventories,” Samsung said in a statement.
Jaejune Kim, executive vice president of Samsung’s memory business, said on an earnings call that Samsung will extend production cuts and make additional production adjustments for certain products, including NAND flash memory chips. He did not disclose the exact extent of Samsung’s production cuts, but noted that the company’s memory chip inventory is falling rapidly after peaking in May.
Coincidentally, SK Hynix also said yesterday that it will further cut NAND production by 5%-10%. Lee Min-hee, an analyst at BNK Investment Securities, pointed out: “NAND is SK Hynix’s weakness, with a quarterly loss of nearly 2 trillion won. More capacity cuts may stabilize NAND prices, which will Good news for Hynix.”
The decision by Samsung and SK Hynix also eased concerns about an oversupply of chips and lifted Samsung shares 2 percent, while SK Hynix shares rose 9 percent to their highest level since March 2022.