In a letter to shareholders released today, Toshiba finally clarified its plans for restructuring the company. Since January 18 there have been numerous rumors that Toshiba planned to spin its memory business off or sell it outright. Today’s letter indicates that this hasn’t been decided yet. In fact, other than to call a late March shareholder vote and to reveal a restructuring, the letter discloses extraordinarily little.
In a nutshell Toshiba has decided to isolate the memory business (including the SSD business but not the HDD and image sensor businesses) into a separate wholly-owned subsidiary. There was no mention of either the recently-shrinking Discrete business or the System LSI business, which has been in a steady decline for the past decade. Click on this post’s graphic to see how each of the company’s semiconductor businesses has been doing.
The intent appears to be to groom the subsidiary to be spun off or sold, but this has not been expressly stated. Instead Toshiba simply states that: “The Company is still considering various structures with a view to an injection of third-party capital.”
The letter reiterates Toshiba’s prior position that the memory business Continue reading
On its way out the door the Obama Administration put together a proposed response to China’s plans to invest $150 billion in the semiconductor market over the next five years. It seems that US semiconductor industry views China’s investment as a threat to its position in the market.
Last week the President’s Council of Advisors on Science and Technology (PCAST) delivered a 25-page Report to the President entitled: “Ensuring Long-Term U.S. Leadership in Semiconductors.”
You might ask: “Who is PCAST?” The organization states its mission in this paragraph: “The President’s Council of Advisors on Science and Technology (PCAST) is an advisory group of the Nation’s leading scientists and engineers, appointed by the President to augment the science and technology advice available to him from inside the White House and from cabinet departments and other Federal agencies. PCAST is consulted about, and often makes policy recommendations concerning, the full range of issues where understandings from the domains of science, technology, and innovation bear potentially on the policy choices before the President.”
PCAST has a small Semiconductors Working Group whose elite members include Continue reading
After a big 3D XPoint launch one year ago almost anyone would expect for Intel to have had a lot of exciting new news to share about the technology at last week’s Intel Developer Forum (IDF). Those who were watching for that, though, were in for a disappointment.
For readers who don’t remember, Intel and its partner, chipmaker Micron Technology, announced a new memory layer in July 2015 that would enable in-memory databases to expand well beyond the constraints posed by standard DRAM memory. The pair also boasted the additional benefit of being nonvolatile or persistent – data would not be lost if the power failed. This technology promised to open new horizons in the world of computing.
Intel devoted a lot of effort to promotion and education during the following month’s IDF, and even demonstrated a prototype 3D XPoint SSD that performed seven to eight times as fast as Intel’s highest-performance existing NAND flash SSD – the DC S3700. Although a DIMM form factor was disclosed, no prototypes were on hand. Both were given the brand name “Optane”.
The Memory Guy has been getting calls lately asking how to tell that a shortage is developing. My answer is always the same: It’s hard to tell.
One indicator is that spot prices which were below contract prices rise above contract prices. This doesn’t happen for all components or densities of DRAM or NAND flash at the same time. Some of these transitions are temporary as well. It takes patience to see if it was a momentary change or if it was the onset of a shortage.
DRAM spot prices have generally been below contract prices since August 2014, but this month they raised above contract prices. NAND flash spot prices also fell below contract prices in mid-2014 but today NAND’s spot price remains lower than contract prices.
Lead times represent another indicator. If the lead time for a number of components increases then those chips are moving into a shortage. Lead times have recently been rising for both NAND flash and DRAM.
A third indication occurs when suppliers start to Continue reading
The answer really depends upon who you ask. An article in the Financial Express quoted Samsung as saying that it would have a minimal impact, and that full-scale operations should resume in a few days. The article also said that Samsung estimated that the wafer loss would be below 10,000 wafers.
Assuming that the entire loss consisted of Samsung’s most advanced 48-layer 256Gb 3D NAND a 10,000-wafer loss would be less than 1% of total industry gigabyte shipments.
Korea Times quoted an anonymous fund manager who said: “The one-time incident will cost Samsung up to 20 billion won, which is very minimal. It won’t make heavy impact on Samsung’s chip business and the entire industry.”
For almost two years there has been a lot of worry about DRAM spot prices. This post’s graphic plots the lowest weekly spot price per gigabyte for the cheapest DRAM, regardless of density, on a semi-logarithmic scale. (Remember that on a semi-logarithmic scale constant growth appears as a straight line.)
The downward-sloping red line on right side of the chart shows that DRAM prices have been sliding at a 45% annual rate since October 2014. This has a lot of people worried for the health of the industry.
What most fail to remember, though, is that DRAM spot prices hit their lowest point twice in 2011, at $2.40 in August, and then $2.20 in November. Today’s lowest DRAM spot prices have only recently dipped below the $2.52 point hit in October of 2014.
The black dotted line in the chart is intended to focus readers’ attention on DRAM costs, which decrease at a 30% average Continue reading
China foundry XMC has broken ground for its new 3D NAND flash fab, the country’s first China-owned 3D NAND flash facility. Plans for this fab were publicly disclosed over a year ago. Simon Yang, XMC’s CEO, gave a presentation at SEMI’s Industry Strategy Symposium (ISS) on January 11, 2015 in which he detailed the need for China to produce a larger proportion of its overall chips, explaining how his company would help make that happen.
Yang used the map in this post’s graphic to show that XMC has enough land on its campus for six 300mm wafer fabs. Two shells (yellow), each capable of processing 30,000 wafers per month, had been constructed by that time: Fab A (left) was already fully utilized, and Fab B (right) was ready for tooling. The gray boxes show that the site has enough space to build 2 additional 2-line megafabs, each with a capacity of up to 100k wafers per month. Accoding to DRAMeXchange XMC currently produces 20,000 wafers of NOR flash per month. A March 30 China Daily article reports that monthly wafer production will reach 300,000 in 2020 and 1 million in 2030.
XMC’s formal name is Wuhan Xinxin Semiconductor Manufacturing, and it is located Continue reading
Beleaguered Toshiba finally unveiled its restructuring plan on Friday. The plan aims to return the company to profitability and growth through management accountability.
A lot of the presentation focused on the memory business, a shining star of the Toshiba conglomerate, which has so far included appliances, nuclear power plants, and medical electronics.
Toshiba has big plans for its Semiconductor & Storage Products Company, calling it “A pillar of income with Memories as a core business”. The company plans to enhance its NAND flash cost competitiveness by accelerating development of BiCS (Toshiba’s 3D NAND technology) and by expanding its SSD business. There are three parts to this effort:
- Grow 3D NAND production capacity
- Speed up 3D NAND development
- Increase SSD development resources
This post’s graphic is an Continue reading
It was sad to hear today of the passing of Andy Grove, Intel co-founder and former president.
Although I did not know him well, Andy was a part of my brief 1½-year stint at Intel in the early 1980s. He played a key role in my “IOPEC” new employee training, and he and I were in cubicles on the same floor of the same Intel office building, so we would run into each other from time to time during the business day.
Plenty has been said about this man’s competence as a manager, and plenty more will be said. He drove the creation of the world’s leading semiconductor manufacturer.
I think I was most impressed, though, when he agreed to be interviewed for a PBS television special on the history of the semiconductor industry: “Silicon Valley: American Experience” despite the fact that his battle with Parkinson’s Disease had already rendered it difficult for him to speak.
I always meant to write to him to tell him how impressed I was that he would do that. I guess I won’t have the chance now.
A July 13 Wall Street Journal article disclosed that China’s state-owned Tsinghua Unigroup has bid to buy Micron Technology for $21 a share or $23 billion, which would make this the largest-ever Chinese takeover of a U.S. company.
Objective Analysis has been telling our clients for the past few years that either China or India would create a new DRAM/NAND manufacturing company, especially since memory chip makers have enjoyed a long period of profits, and this usually motivates outsiders to invest in new DRAM makers. We did not anticipate an acquisition.
Countries with heavy industry typically move into the semiconductor business during an extended upturn, and become DRAM suppliers since DRAM is an undifferentiated commodity. Commodities sell almost solely on price and success is based on little more than manufacturing strength. This is a business model that industrial economies understand.
In addition to Micron’s tangible assets, including Continue reading