Good News for Micron Stock: Memory Chip Price Declines Are Slowing

Motley Fool2023-07-10

The memory chip markets are still in a severe downturn. Samsung, a major memory chip manufacturer, expects its operating profit to plunge by 96% year over year in the second quarter. Weak demand for ...

Source Link

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

Comments

We need your insight to fill this gap

Leave a comment

{"i18n":{"language":"en_US"},"isChannel":false,"data":{"share":"https://ttm.financial/m/news/2350978473?lang=en_US&edition=fundamental","thumbnail":"","is_english":true,"pubTime":"2023-07-10 15:42","share_image_url":"https://static.laohu8.com/e9f99090a1c2ed51c021029395664489","id":"2350978473","market":"us","top_or_hot":-1,"title":"Good News for Micron Stock: Memory Chip Price Declines Are Slowing","media":"Motley Fool","content":"<div>\n<p>The memory chip markets are still in a severe downturn. Samsung, a major memory chip manufacturer, expects its operating profit to plunge by 96% year over year in the second quarter. Weak demand for ...</p>\n\n<a href=\"https://www.fool.com/investing/2023/07/09/good-news-for-micron-stock-memory-chip-price-decli/\">Source Link</a>\n\n</div>\n","source":"fool_stock","html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Good News for Micron Stock: Memory Chip Price Declines Are Slowing</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nGood News for Micron Stock: Memory Chip Price Declines Are Slowing\n</h2>\n\n<h4 class=\"meta\">\n\n\n2023-07-10 15:42 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://www.fool.com/investing/2023/07/09/good-news-for-micron-stock-memory-chip-price-decli/><strong>Motley Fool</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>The memory chip markets are still in a severe downturn. Samsung, a major memory chip manufacturer, expects its operating profit to plunge by 96% year over year in the second quarter. Weak demand for ...</p>\n\n<a href=\"https://www.fool.com/investing/2023/07/09/good-news-for-micron-stock-memory-chip-price-decli/\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"LU0792757196.USD","symbol_name":"TEMPLETON SHARIAH GLOBAL EQUITY FUND \"A\" (USD) ACC","start_time":0,"source_url":"https://www.fool.com/investing/2023/07/09/good-news-for-micron-stock-memory-chip-price-decli/","article_id":"2350978473","we_media_id":null,"thumbnails":[],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2350978473","pubTimestamp":1688974924,"sourceInfo":{"source_id":"fool_stock","name":"Motley Fool"},"weMediaInfo":null,"summary":"The downturn is starting to let up.","collect":0,"end_time":0,"defaultTopTitle":"fool.com","property":[],"viewcount":null,"language":"en","relate_stocks":{"LU0792757196.USD":"TEMPLETON SHARIAH GLOBAL EQUITY FUND \"A\" (USD) ACC","IE00B19Z3581.USD":"Legg Mason ClearBridge - Value A Acc USD","BK4553":"喜马拉雅资本持仓","BK4585":"ETF&股票定投概念","IE00B19Z3B42.SGD":"Legg Mason ClearBridge - Value A Acc SGD","BK4533":"AQR资本管理(全球第二大对冲基金)","BK4554":"元宇宙及AR概念","BK4575":"芯片概念","BK4566":"资本集团","BK4527":"明星科技股","LU1267930813.SGD":"FRANKLIN TEMPLETON SHARIAH GLOBAL EQUITY \"AS\" (SGD) ACC","BK4579":"人工智能","BK4588":"碎股","BK4141":"半导体产品","MU":"美光科技","IE0002270589.USD":"LEGG MASON CLEARBRIDGE VALUE \"A\" (USD) INC","BK4512":"苹果概念","LU2286300806.USD":"Allianz Cyber Security AT Acc USD","BK4111":"出版","LU0889566641.SGD":"FTSF - Templeton Shariah Global Equity A Acc SGD","BK4532":"文艺复兴科技持仓"},"translate_title":"美光科技的好消息是：内存芯片价格下降正在放缓","themeId":"95e3e7595ac2407d82a2e646db9ba6e0","isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"MU":0.9},"content_text":"The memory chip markets are still in a severe downturn. Samsung, a major memory chip manufacturer, expects its operating profit to plunge by 96% year over year in the second quarter. Weak demand for memory chips is the main driver of the decline.Samsung is now cutting memory chip production, something that it was slow to do early in the downturn, while Micron and other manufacturers have been slashing production for multiple quarters. These production cuts are finally having an impact on the supply demand imbalance. While memory chip prices are still declining, the size of those declines is shrinking. That's good news for Micron as the company tries to stem the bleeding as it awaits a better demand environment.An improved pictureMicron manufactures two types of memory chips: DRAM and NAND. DRAM, which is used in random-access memory in PCs, smartphones, servers, and any other computing device that needs quick access to data as its running, makes up around 70% of Micron's revenue. NAND, used in solid-state drives and flash memory to store data, accounts for most of the rest.Memory chips are a commodity, so manufacturers have little in the way of pricing power. While per-bit memory chip prices generally decline over time as manufacturers invest in more advanced manufacturing technology, prices can fall off a cliff when supply overwhelms demand. While cutting production can help bring supply and demand back into balance, it also means accepting lower cash flow. Micron's adjusted free cash flow was a loss of $1.36 billion in its most recent quarter.While production cuts are painful, they're ultimately necessary to reverse a downturn. Micron has been suffering double-digit sequential declines in per-bit pricing during the current downturn, but it looks like those production cuts will finally start to pay off over the next few months. Analysts at TrendForce expect a sharp improvement in pricing declines in the third calendar quarter, which could mean that a recovery is in the cards for 2024.Overall DRAM pricing is expected to be down 0% to 5% in the third quarter on a sequential basis, with older DDR4 memory faring worse than newer DDR5 memory. That compares to an expected decline of 13% to 18% in the second quarter.Meanwhile, overall NAND pricing is expected to drop by 3% to 8% in the third quarter, compared to an expected decline between 10% and 15% in the second quarter. Pricing for NAND chips that go into enterprise and client solid-state drives will fare worse than the overall market, but TrendForce does expect NAND wafer prices to potentially rise by as much as 5%. That could be a sign that supply and demand are closing in on a more balanced state.A possible recovery in 2024It's starting to look like 2024 will be a recovery year for the memory chip industry. What's more, the cuts to production and capital investments that Micron and other manufacturers are making today could plant the seeds of the next shortage, which could drive prices higher.While a widespread shortage like the one experienced during the pandemic may be unlikely, there are pockets of the market where demand could pick up quickly. The explosion of AI training and inference workloads in data centers and on cloud computing platforms could push demand for enterprise DRAM and NAND beyond supply, although that hasn't happened yet.It's hard to predict how much longer this downturn will go on, but it looks like the worst is probably over for Micron.","kind":null,"is_publish_news":true,"is_publish_highlight":true,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"0","news_tag":"","news_rank":0,"symbols":[],"gpt_button":1},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":5,"commentSize":0,"repostSize":0,"favoriteSize":1,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.29.1","shortVersion":"4.29.1","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2350978473"}