DigiTimes, citing industry sources, has reported that PCIe-based SSDs will be overtaking SATA-based solutions during 2019. This makes sense in a number of ways: the smaller footprint for Pcie-based, M.2 SSDs means they are prone to higher adoption form laptop manufacturers tan their SATA counterparts. On the desktop and DIY side of things, SATA solutions have sometimes been preferred to their PCIe counterparts mostly due to the pricing delta between solutions across those form factors.

However, as NAND prices have declined precipitously, and PCIe controllers' pricing has done so too, we are now hitting a point where the cost strain on SATA's additional materials compared to their PCIe counterparts leaves the delta so small that it doesn't make any sense to purchase a SATA-limited drive (usually limited only by the speed of the SATA III interface itself) instead of a PCIe-based one. AS demand picks up some additional 20-25% for 2019, this will mostly be taken up by PCIe-based solutions. Pricing of a 512 GB PCIe storage device is now comparable to that of a 256 GB unit just a year ago. Pricing is expected to keep falling for the duration of this year.

DigiTimes is reporting that three of the major DRAM and Flash players in the industry - Micron, Samsung and SK Hynix - are expected to drop an astonishing 26% sequentially on 1Q19 and 29% YoY for 1Q19. The combined revenue drop for the three DRAM and Flash semiconductor giants comes in the face of seasonality and decreasing prices, and the decline continues an already negative 4Q18, which saw a decrease of 18% sequentially and 26% from a year earlier.

With memory pricing facing a continuous decline in recent times, clients are taking a pondered approach towards ordering from manufacturers - an expectation of future savings being the main factor for this. Demand, however, is expected to pick up in 2H19, due to increased demand from end customers, following price-cuts from manufacturers and improved specifications on end-products.

DigiTimes, citing a Chinese-language Commercial Times report, cites TSMC's 7 nm foundry capacity as likely being underutilized in 2019. After TSMC announced it expected cutting-edge 7 nm designs to correspond to around 20% of the company's revenues in 2019, the company will likely have to review those projections, as lower demand from smartphone chip manufacturers will likely leave TSMC with less actual output than that which it can churn out.

Due to a cutback in orders placed by Apple, HiSilicon and Qualcomm, concerns regarding TSMC's ability to be the sole 7 nm chip fabrication tech for the industry can likely be laid to rest. That the smartphone market is reaching saturation is a well-known quantity - it's becoming harder and harder to cram new technologies that justify the yearly smartphone upgrade that most companies vie for - and one of the reasons for the launch of various brand-specific smartphone subscription services. The difference isn't scandalous - TSMC will still be making use of 80-90% of its total 7nm process capacity during the first half of 2019, the report quoted industry sources as saying.

DigiTimes is reporting plans from both Samsung and SK Hynix to slow down their fabrication capacity expansion plans for NAND and DRAM in wake of lower than expected demand projection for the first half of 2019. This move comes at a time where DRM pricing is still extremely prohibitive due to "higher demand than fabrication capacity output" - and we'd already seen the companies base their fabrication expansions on lower than expected demand increases, as a way to artificially keep pricing for the memory commodity high. NAND is another case - price per GB has been dropping like a rock. And now, the companies want to thwart expected lower demand with lower production values.

Samsung, for one, has reportedly put its plans for additional new production capacity for 1ynm DRAM chips at its fabs in Hwaseong and Pyeongtaek on hold. The chip vendor previously planned to build an additional 30,000 wafers monthly for DRAM memory starting the third quarter of 2018, the sources said - but is now looking to reduce that number to keep pricing from bottoming out. Sk Hynix is also reported to have slowed down its projected production, but details are scarcer on that side of the fence. All in all, it seems that whether there is demand or not, seeing DRAM prices falling to their previous levels is a dream in both name and, not paradoxically, reality.

The latest analysis on the NAND Flash market by DRAMeXchange, a division of TrendForce, forecasts that the ASP of NAND Flash will drop by around 10% QoQ respectively in 3Q18 and 4Q18. Although 3Q18 heralds the traditional peak season for the sales of consumer electronics, the growth of the end market demand has been weaker than anticipated. At the same time, the supply of 3D-NAND Flash continues to expand.

DRAMeXchange points out that the main reason behind the falling prices is oversupply at various levels. First, the annual shipments for smartphones this year are expected to be just on par with last year's. The replacement demand for smartphones has been sluggish due to the lack of differentiation among products in terms of hardware specifications. Second, notebook shipments were very strong in 1H18, so the seasonal shipment growth for notebooks in 2H18 will be lackluster compared with the growth in the year's first half as the base period. Third, the competition is very intense in the server SSD market. Although demand for server systems is growing steadily, there is an oversupply of server SSDs because too many suppliers are engaging in this profitable segment. Finally, NAND Flash suppliers have raised their output forecasts as they have expanded their production capacity and improved the yield rates of their 64/72-layer 3D-NAND production. Given the above factors that have led to a persistent oversupply, contract prices of various NAND Flash products will remain weak through 2H18.

DigiTimes, citing "sources from the upstream supply chain", is reporting an expected decrease in graphics card pricing for July. This move comes as a way for suppliers to reduce the inventory previously piled in expectation of continued demand from cryptocurrency miners and gamers in general. It's the economic system at work, with its strengths and weaknesses: now that demand has waned, somewhat speculative price increases of yore are being axed by suppliers to spur demand. This also acts as a countermeasure to an eventual flow of graphics cards from ceasing-to-be miners to the second-hand market, which would further place a negative stress on retailers' products.

Alongside this expected 20% retail price drop for graphics cards, revenue estimates for major semiconductor manufacturer TSMC and its partners is being revised towards lower than previously-projected values, as demand for graphics and ASIC chips is further reduced. DigiTimes' sources say that the worldwide graphics card market now has an inventory of several million units that is being found hard to move (perhaps because the products are already ancient in the usual hardware tech timeframes), and that Nvidia has around a million GPUs still pending logistical distribution. Almost as an afterthought, DigiTimes also adds that NVIDIA has decided to postpone launch of their next-gen products (both 12 nm and then, forcibly, 7 nm) until supply returns to safe levels.

We've previously touched upon whether or not NVIDIA should launch their 1100 or 2000 series of graphics cards ahead of any new product from AMD. At the time, I wrote that I only saw benefits to that approach: earlier time to market -> satisfaction of upgrade itches and entrenchment as the only latest-gen manufacturer -> raised costs over lack of competition -> ability to respond by lowering prices after achieving a war-chest of profits. However, reports of a costly NVIDIA mistake in overestimating demand for its Pascal GPUs does lend some other shades to the whole equation.

Write-offs in inventory are costly (just ask Microsoft), and apparently, NVIDIA has found itself in a miscalculating demeanor: overestimating gamers' and miners' demand for their graphics cards. When it comes to gamers, NVIDIA's Pascal graphics cards have been available in the market for two years now - it's relatively safe to say that the majority of gamers who needed higher-performance graphics cards have already taken the plunge. As to miners, the cryptocurrency market contraction (and other factors) has led to a taper-out of graphics card demand for this particular workload. The result? NVIDIA's demand overestimation has led, according to Seeking Alpha, to a "top three" Taiwan OEM returning 300,000 GPUs to NVIDIA, and "aggressively" increased GDDR5 buying orders from the company, suggesting an excess stock of GPUs that need to be made into boards.

According to DigiTimes, the entire AIB partner and graphics card supply channel is gearing up to an expected demand decrease for graphics cards in the second half of 2018. This marks an expectation on the continuation of the downward trend since December 2017, a time where Bitcoin (and as such, alternate cryptocurrencies) were at all-time highs. As profits decrease, difficulty increases, and mining players offload their graphics cards to still-interested buyers of their hardware, the market's ability to trade existing graphics cards and absorb new inventory is dwindling. Naturally, this reduced demand means that prices for new graphics cards have also been decreasing and somewhat stabilizing towards pre-mining boom prices.

However, producers of graphics cards obviously don't want to give away their record-high profits in their entirety; and they're showing some reluctance, some "pricing memory" on their graphics cards, maintaining gross margins in the 20% area, double that of pre-mining pricing. As such, graphics card makers are again abandoning the mining boom as a source of stable revenue, looking to other solutions (such as servers, datacenter acceleration and such, DigiTimes reports in the case of TUL). Another thing that would certainly help graphics card manufacturers in keeping up high demand and profits, of course, would be the impending release of a new NVIDIA architecture... At least for those that have AIB status with the company.