Samsung to cut DDR4 memory production

Other than the graphics card, hardware components globally haven’t been this good for consumers in a long time. Because memory chips and DRAM memory modules for SSD drives are very affordable right now, manufacturers are struggling to adapt their businesses to this new trend. While falling memory prices are helping consumers, Samsung aims to reduce DDR4 memory production to keep up with market conditions.

Samsung drops DDR4 production

Samsung, one of the world’s largest DRAM chip manufacturers, is going through a very critical period. The company’s revenues fell 18 percent year-on-year in the first quarter of 2023, while profits nearly evaporated in the worst result of the last 14 years (-95%). Global DRAM and SSD prices are expected to get even cheaper in the coming months, clearly making it harder for manufacturers to recover. Samsung recently announced that it is preparing to cut chip production, and we now know that this cut will likely be a significant one.

The Korean giant is expected to reduce chip production for DDR4 memory modules in a move that will take at least 3 to 6 months (two quarters). Samsung’s total wafer input will decrease by 5-7 percent, possibly with even more negative consequences on the already struggling market. Samsung is the world’s largest memory chip maker with an estimated 45 percent market share. Likewise, Samsung is expected to produce 25 percent fewer DRAM chips this year.

Last year, Samsung significantly reduced the production of DDR3 memory. At that time, the company wanted to direct its corporate or consumer customers to new technologies. It seems that the firm is entering a similar policy process again. But differently, consumers are now adopting a more conservative approach to high-tech spending. As a result of this production reduction, which is expected to last for several quarters, Samsung may expect prices to recover.