SEOUL (Reuters) – Samsung Electronics Co Ltd plans to start constructing a brand new reminiscence chip manufacturing line in China in late March, a spokesman mentioned on Thursday, because the tech big ramps up efforts to spice up NAND flash expertise to fulfill future demand.
The tech big mentioned in August final 12 months that it anticipated to speculate $7 billion over the subsequent three years to increase its NAND reminiscence chip manufacturing in China’s northwestern metropolis of Xi’an, however had not specified a future schedule.
The quickly rising knowledge heart market, which wants extra reminiscence capability to deal with rising knowledge visitors, is predicted to underpin income progress and margins for Samsung’s NAND Flash enterprise in 2018, analysis supplier Trendforce mentioned.
Samsung’s income from NAND within the fourth quarter of 2017 rose 9.eight % from the earlier quarter to $6.17 billion, Trendforce mentioned, as demand from each smartphone and server markets lifted shipments and common value.
Samsung will formally start the method close to month-end at Xi’an, earmarked for NAND flash manufacturing, the spokesman mentioned, however didn’t give every other particulars.
Samsung Electronics shares have risen about 13 % from early March on an improved outlook for the reminiscence chip market, placing to relaxation considerations that the latest increase may finish, analysts mentioned.
“Reminiscence chips are strong. For DRAM chips, server demand may be very sturdy,” mentioned Kwon Sung-ryul, an analyst at DB Funding & Securities.
“NAND flash chip shipments and value actions are shifting inside expectations, however there’s an opportunity that offer will turn out to be tighter once more within the second half of 2018 attributable to rising demand.”
The enlargement shouldn’t be anticipated to have an effect on reminiscence chip provide till 2019 on the earliest, analysts mentioned.
Reporting by Joyce Lee; Enhancing by Shri Navaratnam