Chip industry shock! Intel plans to sell NAND flash business for $9 billion

category:Finance
 Chip industry shock! Intel plans to sell NAND flash business for $9 billion


Source: SK Hynix Chinese official website

Boost the competitiveness of enterprise SSD

Under the agreement, Intel will continue to manufacture NAND wafers at the Dalian flash manufacturing plant and retain intellectual property rights (IP) related to the manufacture and design of NAND flash wafers until the final delivery date.

Intel and SK Hynix will work together to ensure a seamless transition for customers, suppliers and all employees. The two companies will maintain close cooperation in areas related to ddr5.

Sk Hynix stock price trend since May this year

Source: Official Website of the company

The acquisition is limited to 3dnandflash related technologies and capacity, and does not include 3d-xpoint, an emerging memory technology that has attracted considerable market attention recently. At the same time, at present, Intel still insists on flotinggate as the main production structure of 3dnandflash, which is different from the chargetrap structure adopted by SK Hynix and other manufacturers, and has quite different technical difficulties in etching.

Fierce competition in the market

Intel has the industry-leading nandssd technology as well as the NAND flash memory product line of level 4 storage units. In the first half of this year, NAND business generated about $2.8 billion in revenue and about $600 million in profit for Intels nonvolatile memory solutions division. From this point of view, NAND business income generating profitability is not bad, why Intel chose to sell it?

Chinas flash market analysis, the sale is mainly based on two considerations: on the one hand, nandflash market competition is fierce, Intel has long no love war.. Different from CPU, flash memory chip belongs to the industry standard, and the market competition pressure is great. From the current point of view, the whole market is dominated by six original factories of Samsung, Jiaxia, western data, micron, SK Hynix and Intel. Although Intel is on the list, according to the market share ranking of nandflash in the first half of 2020, Intel ranks at the bottom of the six major international storage manufacturers with only 11% share.

Source: China Flash Market

Industry analysis, after selling NAND business, Intel will focus more on CPU business, especially AI field. Sk Hynixs press release said that Intel plans to use the funds obtained from this transaction to develop industry-leading products and strengthen its business focus with long-term growth potential, including artificial intelligence (AI), 5g network and intelligent, automatic driving related edge devices.

This deal will allow us to focus more on investing in differentiated technologies, which will enable us to play a more important role in the success of our clients and deliver substantial returns to investors, Mr. sribe said

The decline of memory price is inevitable

In the first half of the year, affected by the epidemic situation, in order to ensure the delivery of products or out of prudent consideration, downstream customers of the original manufacturer of the storage tank increased their stock preparation efforts, and the volume and price of products rose simultaneously. However, since the second half of the year, the downturn in downstream demand has been transmitted to upstream manufacturers, and the downward trend of product prices is inevitable.

Kang Yi, vice president of guokewei, said in an interview with a reporter from China Securities News: the demand is really poor. In the first two quarters of this year, cloud and notebook as the main demand has basically consumed up. In the last two quarters, there is no strong industry demand, and there are some game opportunities. Weakening demand will bring some price correction, especially the low-end particles.

According to Jibang consulting, even if there is a traditional sales peak season in the third quarter and Apples new machine stock, due to the impact of the epidemic in the first half of the year and the accumulation of terminal sales inventory, the average price drop of nandflash will be as high as 10%. In addition, with the continuous improvement of 128 layer nandflash yield on the supply side, the market situation of oversupply in the fourth quarter will be intensified, and the average price drop of nandflash is expected to continue to expand. According to Wu Yating, an analyst at DRAM, it is expected that the ASP of DRAM will decline by nearly 10% in the third quarter, and the decline will expand to 15% in the fourth quarter, and the decline will maintain for at least three quarters. A staff member of an overseas large-scale memory factory told China Securities News that the decline of memory price is inevitable, among which DRAM will decline more than nandflash, but this round of adjustment cycle will not last too long. Zhang Yali, deputy research director of group intelligence consulting mobile business unit, believes that with the price of 5g smart phones sinking to 1000 yuan, driving the demand for replacement, the memory price is expected to stop falling in the first quarter of next year. Source: Yang Qian, editor in charge of China Securities Journal_ NF4425

According to Jibang consulting, even if there is a traditional sales peak season in the third quarter and Apples new machine stock, due to the impact of the epidemic in the first half of the year and the accumulation of terminal sales inventory, the average price drop of nandflash will be as high as 10%. In addition, with the continuous improvement of 128 layer nandflash yield on the supply side, the market situation of oversupply in the fourth quarter will be intensified, and the average price drop of nandflash is expected to continue to expand.

A staff member of an overseas large-scale memory factory told China Securities News that the decline of memory price is inevitable, among which DRAM will decline more than nandflash, but this round of adjustment cycle will not last too long.

Zhang Yali, deputy research director of group intelligence consulting mobile business unit, believes that with the price of 5g smart phones sinking to 1000 yuan, driving the demand for replacement, the memory price is expected to stop falling in the first quarter of next year.