According to TrendForce’s latest memory spot price trend report, regarding DRAM, price trends for DDR5 and DDR4 in the spot market will diverge, and DDR4 is unlikely to experience a price rebound anytime soon. As for NAND flash, Samsung’s recent notification of EOL (End of Life) for MLC products has led to a small price hike for small-capacity MLC eMMC in the spot market, though the phenomenon is likely to be temporal. Details are as follows:

DRAM Spot Price:

The spot market is showing an overall price trend similar to that of the contract market. Spot prices of DDR5 products remain relatively stable, whereas spot quotes for DDR4 products are under significant downward pressure. To avoid subsequent inventory pressure, the three major DRAM suppliers are eager to offload their DDR4 chip inventories. Hence, TrendForce forecasts that price trends for DDR5 and DDR4 in the spot market will diverge, and DDR4 is unlikely to experience a price rebound anytime soon. The average spot price of mainstream chips (i.e., DDR4 1Gx8 2666MT/s) has fallen by 0.94% from US$1.905 last week to US$1.887 this week.

NAND Flash Spot Price:

The competitions of price slashing are becoming even more severe within the spot market as suppliers are rushing to cash out their inventory with the imminent arrival of Chinese New Year. It is worth noting that Samsung’s recent notification of EOL for MLC products has prompted spot traders to control their stocks and clients of industrial/automotive applications to advance in stocking activities, which led to a small price hike for small-capacity MLC eMMC in the spot market. With that said, the aforementioned phenomenon is likely to be temporal since there is still quite a bit of time before the said EOL arrives, and that market provision remains relatively ample. Spot prices will thus continue to drop as a result. Spot prices of 512Gb TLC wafers have dropped by 1.93% this week, arriving at US$2.445.

According to a report from MoneyDJ, citing the Reuters, Intel’s share price has plummeted this year as the company falls behind in the AI race and faces substantial losses in its foundry business.

Intel is set to release its third quarter 2024 earnings report after the U.S. stock market closes on October 31. According to the report from the Reuters, Intel is expected to announce its largest quarterly revenue drop in five quarters, with Wall Street expecting an 8% decline in revenue to USD 13.02 billion, according to data from LSEG compiled as of Oct. 26.

The Reuters indicated that shareholders are now looking to CEO Pat Gelsinger for detailed plans to help the company navigate this crisis, as the company reports significant losses in its foundry business and struggles to capitalize on the generative AI-driven chip boom.

The report from the Reuters highlighted that Intel’s losses in its foundry business are substantial, driven by the high construction costs of fabs. The foundry’s operating loss for the third quarter is estimated to reach USD 2.55 billion, significantly impacting the company’s overall profit.

According to the report from the Reuters, based on estimates compiled by LSEG, Intel is expected to see a decline of more than 7 percentage points in its adjusted gross margin, dropping to 37.9%.

On the other hand, Intel’s revenue from producing chips for AI-powered PCs is also expected to see an annual decline of more than 6% in the third quarter, as its rival AMD expands its AI PC product lineup, according to the Reuters.

Furthermore, the report noted that Intel’s Data Center and AI business group is also losing market share to AMD, with third-quarter revenue expected to decline by 17%, marking ten consecutive quarters of annual declines.

While Intel still holds a significant share of the server CPU market, demand is increasingly shifting toward AI graphics processors, an area where the company has limited presence, as the report from the Reuters pointed out.

Since taking office in 2021, Gelsinger has aimed to restore Intel to its former glory. He made ambitious promises to bring chip manufacturing back to the U.S. and to compete with TSMC in the foundry market. However, according to MoneyDJ, the second-quarter financial report released in August revealed a significant loss of USD 2.8 billion in the foundry business. On that day, the stock price dropped by 26%, marking its worst single-day decline in 50 years.

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• [News] Intel Steps Back from AI Race with NVIDIA, Shifts Focus to Cost-Effective Solutions with Gaudi 3
• [News] Intel Shifts to TSMC for Chip Production: A Looming Threat for AMD?

(Photo credit: Intel)

The AI boom has boosted the semiconductor industry, increasing the demand for advanced packaging production capacity. According to a report in Economic Daily News, TSMC is rumored to be considering the acquisition of another Innolux plant, particularly its 7th plant in the Southern Taiwan Science Park. However, on October 29, Innolux stated that there are currently no plans to sell the entire plant.

In August this year, TSMC purchased Innolux’s 4th plant in Tainan for NTD 17.14 billion, naming it AP8. It is rumored that TSMC intends to buy another of Innolux’s plants, specifically considering the acquisition of its 7th plant, which is adjacent to the 4th plant that TSMC previously acquired.

However, the report indicated that the management at Innolux holds differing opinions on the sale of its 7th plant and has been unable to reach a consensus.

Innolux’s 7th plant features a 7.5-generation production line primarily dedicated to manufacturing TV panels, and various energy-saving, water-saving, and waste reduction measures were implemented, as mentioned by the report.

As for the plant that TSMC previously acquired from Innolux, the AP8, according to a report by China Times, is expected to start production in the second half of 2025. More importantly, the fab will not only provide foundry services but also the eagerly needed capacity for advanced 3D Chip on Wafer on Substrate (CoWoS) IC packaging services, as the report noted.

The move will be critical for TSMC to meet the surging demand for the advanced packaging capacity for AI servers, according to the report. Its future capacity will reportedly be nine times that of AP6, TSMC’s advanced packaging fab in Zhunan, as the report from China Times noted.

Regarding the current situation of Innolux, its Q3 financial report showed disappointing results. According to a report from Commercial Times, the company recently announced its financial performance for the third quarter of 2024. Due to a decline in TV panel revenue, Innolux recorded a net loss.

According to its press release, consolidated revenue for the third quarter was NTD 55.473 billion, a quarter-on-quarter decrease of 2.4%, while the gross profit margin fell to 9%. The company posted a net operating loss of NTD 790 million, with net profit of approximately NTD 494 million, resulting in a net profit per share of about NTD 0.05.

In 3Q24, the company shipped 6.08 million square meters of total panel, a decrease of 9.3% quarter-on-quarter.

According to its press release, looking ahead to the fourth quarter of 2024, Innolux noted that the timing has entered the traditional off-season for panels. However, China’s new subsidy policy may boost the demand for TV sets. While TV panel prices are expected to remain stable, demand for IT panels is anticipated to slow down.

According to the Commercial Times report, Innolux projects that shipments of large-size panels will decrease by 5% to 9% in the fourth quarter, with the average unit price of shipments declining by less than 5%. In contrast, shipments of small and medium-sized panels are expected to grow by 15% to 19%.

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• [News] TSMC’s Newly Acquired AP8 Facility in Southern Taiwan Rumored to Start Production in 2H25
• [News] TSMC Acquires Innolux’s Plant in Southern Taiwan to Expand Advanced Packaging Capacity

(Photo credit: TSMC)

AMD posted third-quarter results on October 29th, with a quarterly revenue of USD 6.8 billion and net income to USD 771 million, while data center revenue surged 122% year-over-year. With new products such as MI300X hitting the market, the world’s second largest data center GPU provider also raises its AI chip sales forecast for this year to USD 5 billion, up from an earlier estimate of USD 4.5 billion, according to a report by CNBC.

For the fourth quarter of 2024, according to the company’s press release, AMD expects revenue to be approximately USD 7.5 billion, plus or minus USD 300 million. At the mid-point of the revenue range, this represents year-over-year growth of approximately 22% and sequential growth of approximately 10%. Non-GAAP gross margin is expected to be approximately 54%.

Fourth Quarter Forecast Falls to Impress; Concerns Raised on Capacity Constraints

However, the fourth-quarter forecast is slightly below market expectations, which raises concerns about whether the growth of the AI sector might be slowing down. According to Bloomberg, analysts had an average estimate of USD 7.55 billion.

AMD CEO Lisa Su reiterated that the company still sees robust momentum in AI, as interest from customers and partners in the MI325X is strong, a report by CNBC notes. AMD plans to begin production shipments of the MI325X this quarter, according to Su.

In October, AMD introduced the MI325X, and projected that the AI GPU market could reach USD 500 billion by 2028.

Nonetheless, Su also said that the environment will “continue to be tight”, but AMD has also planned for significant growth going into 2025, according to Bloomberg. She stated that the company feels good “about our overall supply-chain capability,” Bloomberg indicates.

AMD’s major foundry partner, TSMC, indicated in July that constraints on AI chip production will persist into 2025, which may imply a significant hurdle for clients like AMD, as it not only has to compete with NVIDIA on product performance, but also on the race of securing capacity.

Strong Data Center Revenue with 122% YoY Increase, while Gaming/ Embedded on the Decline

For the third quarter of 2024, AMD delivered a quarterly revenue of USD 6.8 billion, gross margin of 50%, operating income of USD 724 million, net income of USD 771 million and diluted earnings per share of USD 0.47. On a non-GAAP basis, gross margin was 54%, operating income was USD 1.7 billion, net income was USD 1.5 billion and diluted earnings per share was USD 0.92.

AMD’s AI chips are included in its data center segment, which saw annual sales more than double, reaching USD 3.5 billion. Overall, data center revenue rose 122% year-over-year. Su attributed the strong results to higher sales of EPYC and Instinct data center products and robust demand for the Ryzen PC processors, according to AMD’s press release.

The company also sees robust growth in its client segment, as revenue was USD 1.9 billion, up 29% year-over-year and 26% sequentially primarily driven by strong demand for “Zen 5” AMD Ryzen processors.

However, the gaming segment revenue was USD 462 million, down 69% year-over-year and 29% sequentially primarily due to a decrease in semi-custom revenue. According to CNBC, this could be attributed to reduced “semi-custom revenue” from custom chips used in consoles like the Sony PlayStation 5.

Embedded segment revenue was also declining, down 25% year-over-year to USD 927 million, as customers normalized their inventory levels. On a sequential basis, revenue increased 8% as demand improved in several end markets.

Read more

• [News] AMD Unveils its Latest AI Accelerators MI325X and MI355X, with TSMC Emerges as the Major Beneficiary
• [News] Intel Shifts to TSMC for Chip Production: A Looming Threat for AMD?

(Photo credit: AMD)

With the rapid adoption of AI applications, the demand for high-performance, reliable storage products is growing, drawing unprecedented attention to enterprise SSDs. The global SSD market is currently dominated by five major manufacturers, but as AI gains traction, Chinese enterprise SSD supply chain players are rising quickly through technical breakthroughs.

The enterprise SSD supply chain encompasses three main segments: NAND Flash memory, controller chips, and finished products. NAND Flash serves as the core storage medium and vehicle, available in formats like SLC (Single-Level Cell), MLC (Multi-Level Cell), TLC (Triple-Level Cell), and QLC (Quad-Level Cell).

The controller chip manages data read and write operations, with PCIe technology now the mainstream interface, while SATA and SAS also serve niche markets. The final product stage includes the design, production, and sales of enterprise SSDs.

Due to their significant control over NAND Flash memory, major flash manufacturers hold a dominant position in the enterprise SSD market. According to recent data from global market research firm TrendForce, the top five global enterprise SSD brands by revenue for Q2 this year are Samsung, SK Group (including SK Hynix and Solidigm), Micron Technology, Kioxia, and Western Digital. Collectively, these companies achieved revenues of $5.738 billion, reflecting a quarter-on-quarter growth of 52.7%.

At the same time, Chinese enterprise SSD manufacturers have seen notable growth in recent years, driven by technological innovation and market experience. Notable players in different segments of the enterprise SSD supply chain include Yangtze Memory, DapuStor, DERA, Union Memory, Zettastone, XITC, Memblaze, Unis Flash Memory, and HippStor.

The AI wave is driving massive demand for data storage and processing, which in turn imposes high requirements on the storage market for performance, cost-effectiveness, power efficiency, and reliability.

Domestic enterprise SSD manufacturers are racing to advance in these areas. For instance, in the field of flash memory, they are focusing on QLC technology, which can store more data within the same physical space compared to SLC, MLC, and TLC, thus meeting the high-capacity needs of big data and cloud storage applications.

In controller chip technology, the focus is on the PCIe 5.0 standard. Released by PCI-SIG in 2019, PCIe 5.0 doubles the data transfer speed of PCIe 4.0, enabling faster processing of large data volumes and boosting overall performance, which opens up significant growth potential for enterprise SSDs.

In China’s highly competitive enterprise SSD market, standing out requires more than simply obtaining high-quality NAND Flash and controller chips. Companies must integrate and optimize these components through innovative technology to ensure product performance and reliability, creating a competitive edge that differentiates their offerings from similar products.

 
(Photo credit: Yangtze Memory)