The low point in the storage market has passed

The storage industry has passed its revenue trough and is expected to improve its profit margin as the industry's supply and demand balance gradually recovers.
 

Overall, the financial reports of the world's top storage companies in the second quarter generally showed varying degrees of increase or decrease compared to the previous quarter. Of course, in 2022, which had a higher year-on-year base, there was still a significant decline.
 

From a historical cycle perspective, the storage industry has a cycle of approximately 3-4 years. This cycle began in Q1 2020 and reached its peak in Q1 2022. Currently, it has been continuously reducing prices for 6 quarters and is in the bottom stage of the cycle.
 

With upstream storage factories offering measures to stabilize prices and reduce production, the storage industry began to show a positive trend month on month in the second quarter. Several leading storage manufacturers have stated that the industry has started to bottom out.
 

In terms of price, starting from Q2 this year, multiple suppliers have issued bottoming signals. Firstly, Samsung and Meguiar issued a notice to the distributor that they will no longer accept DRAM and NAND orders at low prices; On the spatial side, the scale of storage chips may increase quarterly starting from Q2 23 in the short term, and in the long term, the demand for storage catalyzed by AI is expected to increase several times.
 

In the current market, AI has become an undeniable growth driver in the DRAM industry, and core technology HBM has become a high-frequency term in performance meetings. For the NAND Flash flash memory market, its recovery progress may be slower than DRAM due to less traction from the AI wave demand.
 

The global storage chip market will begin to recover in the second quarter of 2023, but its latest report points out that there is no need to hold too much hope for the storage chip market in the third quarter of 2023. Optimistic estimates suggest that the market will start to recover from the fourth quarter of this year.