Kunpeng Project
The rise of China's memory chips Samsung memory and flash memory lost 80 billion a year
The rise of memory chips in China: Samsung memory and flash memory lose 80 billion yuan every year!
Earlier, Samsung released its FY2023 annual report, and the company** its FY2023 revenue was 1.4 trillion won, down 15% from the same period last year. Operating income was 654 trillion won, down 85% year-on-year.
The sharp decline in earnings is apparently due to the decline in Samsung's semiconductor industry, which expects an operating loss of 75 billion yuan to 800 billion yuan in the final quarter of this year.
If Samsung is not affected too much, then their real profit should be around 110 billion.
As you can see, Samsung benefits from the blank space of the memory (DRAM + NAND) of other manufacturers**.
As shown in the figure, Samsung, the world's largest memory manufacturer, accounts for about 40% of the world's DRAM and NAND flash memory, why is there such a huge loss?
Therefore, we have to say that China's huge storage capacity has promoted the growth of China's memory, and surpassed the advantages of Samsung, SK hynix, Micron and other companies, coupled with the downturn of the entire chip market, which finally created today's situation.
As shown in the figure above, the world's five largest manufacturers monopolize more than 95% of the world's parts, so the five giants are de facto monopolies, and if they join forces to raise prices, the downstream will definitely agree.
However, in 2022, the situation has undergone some changes, and China's memory manufacturers are getting stronger and stronger, among which YMTC and Changxin have broken the previous low situation, although they do not occupy a large share.
Last year, we saw that the price of DRAM and NAND flash memory chips continued**, especially domestic chips, and foreign manufacturers followed suit, and finally collapsed completely.
In addition, since the beginning of this year, the entire chip industry has been going downhill, coupled with Xinxin, Changdian and other manufacturers taking the lead, resulting in a significant price of DRAM + NAND chips.
As a result, Samsung, SK hynix, and Micron all incurred huge losses in the 2023 fiscal year, of which Samsung lost nearly 80 billion yuan, SK hynix lost about 80 billion yuan, and the three giants lost a total of 15 billion yuan.
However, with the cost of chips already increasing by more than 20%, and by 2024, the growth rate of chips is still above 50%, Apple may be forced to raise it.
I would very much like to know if domestic manufacturers can have a strong competition in the price, quality and capacity of their products, so that these international giants cannot increase the price of their products, thereby reducing our profitability.