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3D NAND sales plummet across the globe as demand falls

3D NAND sales plummet across the globe as demand falls

Demand for 3D NAND memory dropped sharply during the third quarter of 2022, causing the overall NAND manufacturing industry’s revenue to drop 24.3% quarter-over-quarter, according to research (opens in new tab) from market intelligence firm TrendForce.

The NAND Flash industry recorded total revenue of around US$13.71 billion for 3Q22, which Trendforce linked to below-expectation numbers in terms of overall shipments of end products, such as consumer electronics, workstations, and servers, linked to a generally pessimistic economic outlook and lower capital expenditures from firms.

3D NAND shipments dropped 6.7% during the quarter as per the research, but this then led to a drop in average prices of 18.3% during the period, as manufacturers looked to reduce prices as part of efforts to make their products more appealing. 

What is 3D NAND?

3D NAND is a variety of non-volatile flash memory in which memory cells are layered vertically on top of each other, in contrast with 2D NAND, which has just one memory cell.

Who took the hit?

This decline wasn’t felt equally among manufacturers. 

South Korean hardware giant SK Group’s revenue slipped by 29.8% quarter-over-quarter to $2.54 billion, placing it number three in the ranking of NAND memory manufacturers.

Samsung remained at the top of the totem poll of NAND manufacturers with a 31.4% market share, shifting $4.3 billion of hardware for the period, despite sales declining 28.1% quarter-over-quarter.

In keeping with the wider industry decline, Western Digital saw its revenue fall by 28.3% QoQ to $1.72 billion, while Micron registered a 26.2% revenue drop to $1.69 billion.

The market’s outlook remains pessimistic, at least for the near future according to TrendForce. 

The analyst firm predicts that as a result of high inventory and falling prices, the NAND Flash industry will post a further decline of almost 20% in its total revenue for the fourth quarter.

Trendforce predicts with the exception of Samsung, suppliers are set to be more cautious in planning output, and will look to “restore balance” to supply-demand dynamics as quickly as possible, which could include measures such as cutting wafer input and decelerating the pace of technology migration.

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