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Is It Groundhog Day for Memory Chip Suppliers?

Memory suppliers rushing to build new fabs appear destined to reignite the destructive flames of pricing and inventory instability they have just succeeded in putting out.
Is It Ground Hog Day for Memory Chip Suppliers?

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By Bolaji Ojo

What’s at stake?

The memory IC market is notorious for its dizzying cycles. Another one is playing out right now as pricing pressures finally level off, buoying sales. But as they are marking the end of a crisis, the new fabs that suppliers are competing to build under government pressure are pushing them towards the recurring nightmare of demand-supply disequilibrium. Will this market, whittled down to a handful of suppliers, ever gain some semblance of normality?

Memory semiconductor suppliers must be addicted to pricing turbulence. Or they are resigned to fate.

Having barely emerged from the last downcycle during which sales fell a stomach-churning 50 percent, memory IC makers are back at it again, adding new fabs and laying the groundwork for what could be the next punishing round of severe price swings.

They would say that is not the case, though.

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