According to a new research report by a US-based foreign investor, the memory market is expected to experience a more significant price decline in the second half of 2022, so all memory products will be affected. In this context, the foreign investor downgraded the investment rating of memory control IC major Qunlian to 'neutral', while memory major Nanya Technology reiterated its 'underperform' rating due to the oversupply of DDR3.
According to the report, memory prices will continue to fall in the second half of 2022 due to weak market demand. In addition, customers and manufacturers still hold high inventories, making the supply chain face huge pressure to destock, making it difficult for prices to stabilize in the short term. In addition, it is rumored that Korean memory makers are now exiting the DDR3 market and moving into the DDR4 market. At present, it seems that both manufacturers have not completely abandoned the consumer market and are striving for customers to move to DDR4 in an effort to continue to stabilize prices.
Overall, the foreign investor predicts that spot prices for niche DRAM will fall another 13% to 18% in Q3 and 10% to 15% in Q4 2022, while NAND Flash will lose 13% to 18% in Q3 and 15% to 20% in Q4. In this high inventory and deteriorating NAND Flash pricing environment, coupled with the fact that the recovery time is not expected to be quick, it will have a negative impact on Qunar, hence the investment rating of "Neutral".
According to data from Tiburon, DRAM industry revenue came to US$25.59 billion in 2Q2022, up 6.5% QoQ. The main reason for the revenue growth came from the growth in the number of bits shipped by some DRAM suppliers. Although demand for PC and mobile DRAM has started to weaken due to the impact of inflation, server DRAM momentum remained strong in the first half of the year, driving shipments from all three major original manufacturers to increase by 5-10% QoQ. Looking ahead to the third quarter, due to further pressure on original manufacturers' inventories, price declines will expand significantly. At the same time, shipments will be affected by customer inventory adjustments, making it difficult to grow, and the revenue of the three companies is likely to fall.