TrendForce released a report today saying that the NAND Flash market has faced demand headwinds since the second half of 2022, and the supply chain has actively destocked to deal with it. It fell by 20%-25%, among which Enterprise SSD was the product with the sharpest decline, with a drop of about 23%-28%.
The report pointed out that while the original factory is actively reducing prices to increase volume, customers have a negative attitude towards stocking up in order to avoid further increase in component inventory. As a result, NAND Flash bit shipments in the fourth quarter increased by only 5.3% quarter-on-quarter, and the average sales unit price decreased by 22.8% quarter-on-quarter. In the fourth quarter of 2022, the revenue of the NAND Flash industry fell by 25.0% quarter-on-quarter to US$10.29 billion (currently about RMB 71.001 billion).
TrendForce said that in the first quarter of 2023, the production lines of Kioxia and Micron will continue to be under low load, and Western Digital and SK Hynix will follow up to reduce production, which may alleviate the current situation of oversupply, and the average price decline of NAND Flash will also converge to 10% %-15%.
In addition, the report stated that even though the reduction in production will help curb price declines, as the first quarter is the traditional off-season and customers’ purchasing power is insufficient, the growth of overall NAND Flash product orders will be limited. 8.1% reduction.
▲ Source: TrendForce Consulting
