Phison Boss Wary of NAND Industry Weaknesses

[T0@st]

The NAND memory industry is not in great shape at the moment, with the big three (Micron, Samsung, SK Hynix) having reported significant financial losses in this area recently. If you include Kioxia and Western Digital as part of this collective picture, a grand total of over $10 billion has been lost in the flash memory segment. According to DigiTimes Asia this week, Pua Khein-Seng - the chief executive officer of Phison Electronics Corporation - has warned that parts of the industry could collapse due to potential company bankruptcies.

Khein-Seng informed attendees at a press conference that forced NAND price cuts are not feasible in the current market environment, and that supply chains could be affected if related companies start to shutdown - due to operational losses. He expects 3D NAND manufacturers to cutback on output in order to soften the market, and unit price increases are also a possibility. Phison has experienced a drop in revenues for the first quarter of 2023, but the CEO insists that his company is not willing to cutback on research and development costs - 80% of its annual expense budget will be invested in future projects. Khein-Seng states that rival companies have reduced spending on R&D by 20%, yet Phison remains committed to its clients by providing cutting edge technology (for example the E26 SSD memory controller).



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[bonehead123]

Good for you Phison, just stick with it guys, things will get better, you just have to look at the long game, as your BossMan apparently is....

But if the other controller & NAND mfgr's cut back on making new/updated devices, or start jacking up prices, then the drive mfgr's will cut back on making new/updated drives, the supply of which will then dry up, resulting in higher prices for the end users, resulting in fewer users buying new drives, resulting in increased losses of profits, resulting in less $$ for R&D and so on and so on....

It's not that hard....I freely admit that I'm no financial/marketing/manufacturing genius, but even I know how these things work !

As for Phison's rivals, well, if they aren't/weren't smart enough to set aside some moolah to get them thru some hard times, then they deserve to die IMHO, again, it's not that hard to figure out

 

[maxfly]

It's part of the global downturn every sector is or will be suffering through. Some hit it months ago, some are hitting it as we speak, some haven't hit it yet. The NAND and memory sector hit it quite a while ago. There's no magic bullet that will pull companies out of it unfortunately. Because there is such a glut of product currently, there will be bankruptcies imo. There's no two ways about it. The small corporations will either have to find creative ways of navigating their way through this economic downturn or they will fail. I've read about some of the smaller companies finding new markets (albeit very small and vague) for their products in places they never made them for. That's likely the type of action that's going to save them vs the ones that stick to the status quo and fail.

 

[Dwarden]

i have Deja vu , it reminds me on memory manufacturers , each time complaining about prices and then setting up cartel to hike prices up and starve supply

 

[maxfly]

i have Deja vu , it reminds me on memory manufacturers , each time complaining about prices and then setting up cartel to hike prices up and starve supply

I hear ya. I haven't forgotten the price fixing fiasco either. Its hard to have sympathy for the big 3 at all. I feel for the small companies that weren't around tho.