SEOUL, Nov. 2 (Korea Bizwire) — Samsung Electronics Co., the world’s largest memory chip maker, is agonizing over its growing stockpile of inventory amid a slowdown in chip demand worldwide.
According to company data, its third-quarter inventory assets amounted to 57.3 trillion won (US$40.4 billion) after passing the 41 trillion won mark in the fourth quarter of last year.
Samsung’s inventory assets broke the 50 trillion won mark in the second quarter of this year.
Amid oversupply concerns, the prices of both DRAM and NAND flash have continued a downward trend for several months.
The increase in offline activities resulting from the pandemic’s slowdown led to a decline in demand for IT devices.
Worse, the Ukraine war resulted in a hike in commodity prices, igniting overall inflation.
Samsung, however, is sticking to the position that it would not temporarily cut production simply to reduce inventories. Instead, it plans to prepare for a recovery in chip demand from a mid-to-long term perspective.
The tech giant also has no plans to greatly increase chip production. The increase in chip size of DDR5, the next-generation standard for DRAM used mainly for data center servers, has caused restrictions on output growth.
J. S. Shin (firstname.lastname@example.org)