Weekly Dynamics of the Storage Industry

This week’s developments in the storage sector center on two key shifts: original equipment manufacturers (OEMs) delaying the phase-out of DDR4 production and adjustments to export exemptions.

Persistent price inversion of DDR4 has disrupted supply-demand balance, driving its price up for four consecutive months—with profit margins now outpacing those of DDR5.

Buoyed by robust market demand, storage vendors have opted to sustain DDR4 production. Following Samsung’s decision to extend its DDR4 production halt timeline, SK Hynix has similarly announced it will delay phasing out DDR4 until 2026, while significantly ramping up output at its Wuxi facility (the core of its DDR4 production network).

This move spells mounting market pressure for downstream manufacturers that had originally planned to capture a larger share of the DDR4 market. The impact is already visible in capital markets, where domestic storage-related firms saw a collective 5% drop in stock prices.

From a competitive standpoint, Samsung Electronics—bolstered by its scale of production capacity and technological expertise in DDR4—is poised to emerge as the biggest beneficiary. Among upstream players, only Micron remains committed to its DDR4 phase-out plan, instead focusing on DDR5 product iteration and market penetration.

On the U.S. export front, exemptions previously granted to Samsung, SK Hynix, and TSMC’s Nanjing plant have been revoked. This means that future exports of controlled semiconductor equipment or components (such as NAND and DRAM) could delay capacity expansion plans for affected enterprises, posing potential risks to the stability of the global semiconductor supply chain.

For module manufacturers, rising quotes and expanded shipments of both DDR4 and DDR5 have translated to strong performance. Nanya Technology, for instance, reported its highest monthly revenue in 43 months in August, raking in NT$6.76 billion (approximately USD 218 million).

In other news, SK Hynix has installed the first mass-produced High NA EUV (Extreme Ultraviolet Lithography) tool at its M16 facility—a critical step to advance next-generation memory development. This equipment is expected to first be deployed in the HBM (High Bandwidth Memory) supply chain, further solidifying SK Hynix’s competitive edge in the high-end storage market.

Product-Specific Trends

• DRAM Market: Acceptance of finished memory modules remains low, with prices edging down and shipments moving sluggishly. Meanwhile, speculation around server-grade DRAM chips remains intense.

• SSD Market: Prices are projected to see a modest uptick, but the rebound will be limited due to weak end-user demand and sluggish offline sales channels.

• Flash Wafer Market: OEMs have cut contract prices for high-capacity wafers, while spot prices for 32G TLC wafers have inched up. Low-capacity products continue to be marginalized.

• USB Market: Prices of USB chips and TF cards have risen slightly, with demand showing mild improvement—but inventory stock remains limited.