The semiconductor memory sector, particularly the dynamic random-access memory (DRAM) market, is currently witnessing significant price fluctuations that have caused ripples throughout the industryThanks to the extensive market research and analytical prowess of Omdia, forecasts indicate that the trend of declining DRAM prices is anticipated to continue until the latter half of 2025. One notable point of interest is the relatively stable pricing of server DRAM in 2024, which has positioned it starkly against the backdrop of the current bearish market conditions.

According to Omdia’s detailed reports, the pricing trends for PC, server, and mobile DRAM are exhibiting a somewhat synchronized downward trajectory, expected to persist until Q3 of 2025. Specifically, prices are projected to fall by around 10% in the first half of 2025, with a more modest decline of approximately 5% in the second halfThis downturn can be attributed to a complex interplay of market supply and demand dynamics as well as various industry developments.

On the demand side, the uncertainty surrounding global economic growth and the saturation of the consumer electronics market are leading to persistently sluggish demandIn the PC sector, consumer demand for upgrading computers has diminished; existing PC capabilities are adequate for most day-to-day office tasks and entertainment needsMoreover, the shaky economic landscape is compelling consumers to adopt a more conservative approach to spendingIn terms of mobile devices, the market for smartphones and tablets has reached a saturation point, resulting in sluggish shipment growth and consequently diminishing demand for mobile DRAM.

Conversely, on the supply front, the rapid expansion of memory production capabilities in mainland China has emerged as a pivotal factor contributing to the market's oversupply

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The combined effect of weak demand and surging production capacities has caused general memory prices to start declining as early as the second half of 2024. As we move into 2025, this downward price trend extends beyond traditional DDR4 products, encompassing even the cutting-edge DDR5 variants, which have also succumbed to price pressures.

ChangXin’s strategic initiatives are actively progressing, currently working on Phase II expansions in Hefei and BeijingTheir production plans include a diverse range of products such as DDR4, LPDDR4(X), and LPDDR5, aiming to enhance domestic replacement rates while reducing China's reliance on foreign DRAM productsIn addition, ChangXin is also making a strong push into the high-bandwidth memory (HBM) sector, planning to mass-produce second-generation HBM2 stacked with eight layers

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This type of high-performance memory has a wide range of applications in artificial intelligence and data centers, and ChangXin's move into this space will bolster its positioning in the high-end memory market.

In response to the ongoing decline in market prices, major memory manufacturers such as Samsung Electronics and SK Hynix are actively adjusting their strategiesGiven the weak overall market demand, these leading firms are reducing their shipment volumes for the first quarter in an attempt to stabilize prices through supply adjustments in the overall DRAM marketIn its recent financial disclosures, Samsung Electronics highlighted that inventory adjustments among clients in the mobile and PC sectors are expected to carry on into the first quarter, signaling a broader trend of postponements in memory demand due to supply constraints in the server market, particularly affecting data center customers reliant on GPUsThis clearly illustrates the current state of supply and demand conditions and their impact on pricing mechanisms.

Currently, the entire memory industry is keeping a close eye on any signs of recovery in the DRAM market in the latter half of the yearMarket sentiment is largely anchored on the understanding that as DRAM prices continue to drop into the second half, the adjustments in inventory on the demand side coupled with an uptick in shipments will be critical drivers for market recoveryHowever, the adjustment process on the demand side takes time; as the market gradually clears existing inventories, fresh demand is anticipated to be releasedThe increase in shipments will rely on various factors, including global economic recovery, emerging technologies that create new demands, as well as the efficacy of production capacity adjustments and market strategies enacted by prominent manufacturersLooking ahead, the trajectory of the DRAM market will continue to be influenced by a multi-faceted interplay of supply and demand dynamics, technological innovations, and company strategies, rendering its price trends and market configuration inherently uncertain.