On September 2, it was reported that due to weakening demand in the consumer electronics market, the NAND Flash memory market has also experienced a significant decline. According to a report released yesterday by market research firm TrendForce, the contract price of NAND Flash wafers in Q3 is expected to drop by 30% to 35%, which is about double the original forecast of a 15% to 20% decline, with a further correction of 20% anticipated in Q4. This indicates that NAND prices in the second half of this year may be significantly adjusted downwards by 50% compared to the first half.
Regarding the trends in the NAND Flash market, Phison Electronics CEO Pan Jiancheng admitted that there is indeed pressure on inventory, and NAND Flash chip prices will decline in Q3. Phison continues to recognize inventory reserves, anticipating that as the market recovers in the future, raw material prices will rebound.
Pan emphasized that the current issue is not an oversupply but a rapid decline in demand, leading to inventory accumulation. There is still hope for demand during the Christmas peak season at the end of the year, and it is expected that inventory may slightly ease in Q4. The company’s operations in the second half of the year should not decline compared to the first half.
ADATA, a NAND Flash module manufacturer, believes that with new production capacity still coming online, combined with competition in advanced processes and continuous cost reductions, there is downward pressure on prices in Q3. In the short term, the NAND Flash market is affected by multiple external factors. The company is not only rapidly reducing NAND Flash inventory but also accelerating the promotion of products in gaming, electric tricycles, and industrial control to enhance overall operational efficiency.
TrendForce analyzed that the reason for the larger-than-expected price drop is primarily due to a freeze in NAND Flash market transactions, with buyers increasingly reluctant to negotiate prices. This has led to manufacturers facing critical inventory pressure, prompting them to offer significantly lower prices to secure sales, further driving down prices.
Editor: Lin Zi, Chip Intelligence
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