Adata Expects Memory Prices to Rise After Coronavirus Is Contained

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Adata is looking forward to Coronavirus being contained and not just for the obvious reasons. Chairman Simon Chen is apparently optimistic that prices for DRAM and NAND flash technologies will grow this year once the virus is under control, according to a DigiTimes report Monday. 

Chen hopes that growing demand for memory products will resume by June if the latest health scare is contained. That's despite concerns about Coronavirus impacting Q1 demand. According to DigiTimes, Chen said that although he expects the outbreak to hurt Q1 numbers for physical retailers, large growth from online retailers will help push things into the positive. NAND prices have climbed 30-40% since Q4 2019, DigiTimes said. 

China extended the Lunar New Year holidays to last until February 2 in order to help contain the virus. RAM makers that "were originally expected to enjoy strong order pull-ins after the holidays are likely to see their shipment momentum delayed," the publication added. 

According to the DigiTimes, DRAM and NAND prices haven't changed much yet; however, they're expected to drop after the market begins trading again (its stock market re-opened on February 3). 

At the end of 2019, Adata’s monthly revenues from SSDs more than doubled year-over-year, accounting for over 30% of its total revenue. The report noted that data centers have started restocking their inventory, while at the same time PCs and high-end smartphones are expected to increase demand for SSDs. This could reportedly lead to potential supply issues for NAND flash products in the first half of 2020, according to DigiTimes.

However, Korea-based SK Hynix is said to have plans to cut its 2020 capital expenditure (CapEx) due to market uncertainty. In 2019, SK Hynix's CapEx already dropped 25% on year to KRW12.7 trillion (US$11.43 billion).

Lucian Armasu
Lucian Armasu is a Contributing Writer for Tom's Hardware US. He covers software news and the issues surrounding privacy and security.
  • Giroro
    "NAND prices have climbed 30-40% since Q4 2019, DigiTimes said. "

    Is that calendar Q4?
    As in, prices have shot up 40% in the last 4 weeks? I figured the NAND manufacturers would have chosen a more gradual timeframe when they all agreed it was time to raise prices... But I guess they have to grab as much money as they can before another government launches a major investigation into the industry.