[Concall] Samsung Electronics "There is a production cut effect... Additional adjustment of production cut scale mainly for NAND in the second half"

Samsung Electronics stated that the memory semiconductor production cut measures announced last April are currently showing effects through inventory reduction, and additional production cuts focusing on NAND products are expected in the second half of the year.

During a conference call held after announcing the confirmed Q2 earnings on the 27th, Samsung Electronics explained the ongoing effects of the memory semiconductor production cuts, saying, "Due to weak demand, memory semiconductor inventory was at a high level in the first half of the year, but after production adjustments, inventory peaked in May and has been rapidly decreasing."

They added, "We plan to continue production downward adjustments in the second half. In particular, to accelerate inventory normalization, we will make additional production adjustments for both DRAM and NAND, but especially significant production cuts will be made focusing on NAND." They also mentioned plans to strengthen market responses centered on high-profit products. Samsung Electronics said, "Through expanding the production and sales ratio of high value-added products such as HBM and DDR5, there will be qualitative improvements in the portfolio," and added, "In contrast to reducing production of legacy processes, increasing the proportion of advanced processes will clearly show the effects of expanded portfolio adjustments."

Regarding the memory semiconductor demand outlook for the second half, they explained, "Although prices declined in the first half, customers have made considerable inventory adjustments, so the price decline in Q2 slowed compared to Q1. In the second half, demand improvement is expected mainly in PCs and mobiles, where inventory adjustments have progressed, compared to the first half." They continued, "On the supply side, some market changes may occur in the second half due to the expanded scale of production cuts," and forecasted, "The rebound timing for NAND may be delayed, but for DRAM, demand is expected to increase mainly for products applying special processes, which could lead to a price rebound."

This content was produced with the assistance of AI translation services.