Memory chip prices are expected to fall further through the first half of 2023, and possibly beyond. TrendForce, a market intelligence firm, predicted that DRAM prices would fall by 20% in the first quarter and 11% in the second quarter. Meanwhile, NAND flash prices are expected to fall 10% and 3% in the first and second quarters, respectively.
According to TrendForce, DRAM and NAND flash prices fell 23 percent and 28 percent in the previous three months. Memory chip pricing peaked during Covid due to strong consumer electronics demand, but began to fall near the end of 2021. Rising interest rates, geopolitical uncertainty from the Russia-Ukraine war, and sporadic Covid lockdowns in China exacerbated the situation in 2022.
According to the research firm, a combination of high interest rates, rising inflation, and weak global economics will continue to impact consumer and corporate spending on devices such as smartphones, PCs, and servers, all of which use both types of memory, in the coming months.
The decease in memory chip prices could put additional strain on a tech industry already dealing with reduced investments and job cuts.
Samsung warned earlier this month that operating profit for the October-December quarter is expected to fall 69 percent from the same period last year. FactSet analysts predict that memory chip maker SK Hynix will report a fourth-quarter loss of about $661 million later this week. Intel reported a 32% drop in revenue year over year in its most recent quarter.
Smartphone demand was low during the holidays, but Samsung may be able to kick-start sales in 2023 with a new wave of products set to be announced at its Unpacked event on February 1. Nothing has also confirmed plans for its next flagship to arrive in the United States later this year, and Apple’s iPhone 15 is almost certainly coming in September.